Printed from http://www.electronista.com

MS may need first-ever loan to buy Yahoo

updated 08:20 am EST, Tue February 5, 2008

MS Needs Loan for Yahoo

Microsoft may need to abandon its longstanding financial independence to complete a takeover of Yahoo, the company said late yesterday. Despite its large cash reserves, the company's Chief Finance Officer Chris Liddell acknowledged that the $44.6 billion proposed deal might require that the firm borrow money and accumulate debt. While the $21 billion in reserves owned by the Windows developer would cover nearly all the cash portion of the proposed deal, a loan would help Microsoft avoid wiping out these reserves and leaving itself without options if it needs more cash in the near future, according to the executive.

The willingness to rely on loans indicates Microsoft's commitment to its proposed bid, which is widely understood to be an attempt to thwart Google's control of search and web advertising. The company has officially claimed to be creating a viable alternative in the market.

However, reports have surfaced that Yahoo considers Microsoft a threat and that the company is considering an alliance with Google or other alternative firms as an attempt to make a Microsoft deal impractical or impossible. Google has commented on the deal and warned that Microsoft might translate its monopolies with Office and Windows to the Internet by creating proprietary web standards.



By Electronista Staff
Post tools:

TAGS :

toggle

Comments

  1. zaghahzag

    Dedicated MacNNer

    Joined: Aug 2006

    0

    so it begins

    this reminds me of AOL/Time Warner. it's going to be a giant disaster for M$. Their debt will spiral and finally they will die the death they so greatly deserve for making all of us suffer with crappy software.

  1. Gee4orce

    Professional Poster

    Joined: Dec 2000

    +1

    The beginning of the end

    This is the beginning of the end for Microsoft. They are so obsessed with going after Google that they are risking their entire business on it.

    I'm all in favour ;)

  1. Deal

    Mac Enthusiast

    Joined: Apr 2001

    0

    Crazy

    It's like a really bad episode of Jackass.

  1. garmonbosia

    Fresh-Faced Recruit

    Joined: Aug 2002

    0

    further news

    The rumour is that Ballmer has asked Jobs to help fund the buyout by selling a minority stake in M$.

  1. testudo

    Forum Regular

    Joined: Aug 2001

    0

    Re: further news

    How would Jobs selling a minortity stake in MS help fund this?

  1. robttwo

    Fresh-Faced Recruit

    Joined: Nov 2005

    0

    A suggestion

    Ballmer - instead of trying to buy Yahoo - why not use the money to hire decent programmers? Ones that know what they are doing, can adequately test software, and understand the end-user.

    Doofuses.

  1. Feathers

    Grizzled Veteran

    Joined: Oct 1999

    0

    twenty-one billion

    I thought M$ cash reserves were larger particularly when you consider that Apple is holding reserves of something like sixteen billion. Of course, M$ market cap is around $283 billion against Apple's $115 billion, so it appears that all round Apple are in a far more solid financial position. This Yahoo thing could really be the making or breaking of Microsoft and is Ballmer really the person to have in charge in a less than bullish climate? XBox replacements could easily knock another billion off those reserves (on top of the supposed one-off charge they've already taken). Gotta love Google and Nintendo!

  1. jdonahoe

    Junior Member

    Joined: Jul 2006

    0

    re: Google's comment

    "Google has commented on the deal and warned that Microsoft might translate its monopolies with Office and Windows to the Internet by creating proprietary web standards."

    Duh!! How many times have I gone to a website and told that if I want to see anything on that site, I HAD to use Explorer!! Microsoft proprietary web standards, they're already here!

  1. ender

    Junior Member

    Joined: Mar 1999

    0

    re: further news

    I think he was referring to MS buying a minority stake in Apple when Steve Jobs returned.

    You might want to turn up the gain on your Sarcast-o-meter.

  1. danviento

    Fresh-Faced Recruit

    Joined: Dec 2005

    0

    Wasting SHOWS UP

    This is what happens when you purposefully loose money on products like the XBox 360 just to keep the vapor position of "dominant player," even though they still rank third in sales, no matter how you put it.

Login Here

Not a member of the MacNN forums? Register now for free.

toggle

Network Headlines

toggle

Most Popular

Sponsor

Recent Reviews

Logitech Hyperion Fury mouse

Selecting the correct gaming mouse comes down to finding a device that balances the needs of a user with a price they can afford. Ofte ...

Life n Soul BM211 Bluetooth speaker

Bluetooth speakers aren't only for listening to some music at the park or on a long bus ride, but can also be built with tablets in mi ...

Epson PowerLite Home Cinema 2030 projector

With high-definition televisions now the standard, 4K televisions becoming the next big thing, and plasma TVs going the way of the din ...

Sponsor

toggle

Most Commented

 
toggle

Popular News