updated 12:00 pm EST, Thu March 6, 2008
MS Cash Offer for Yahoo
Microsoft is mulling the possibility of making a direct cash deal to increase the strength of its offer to buy Yahoo, says a claim from the New York Post. The newspaper points to purported sources who say that Microsoft is considering changing its original bid from a share-based bid, which linked the value to Yahoo's stock price, to buying the company with a flat, undisclosed amount. The maneuver would reportedly provide greater incentives to shareholders and in turn push Yahoo's board to drop its current resistance to the deal.
Contacts for the paper also claim to have confirmed that a deadline extension for a board election is a means of giving Microsoft more flexibility in any proposed deal, though Microsoft itself is said to be frustrated with Yahoo's attempts to strike deals with Time Warner or other companies. Most of these would either make a hostile Microsoft takeover impractical or else reduce the incentives to make any purchase. News Corp. and other outlets have also been named as alternative candidates for any Yahoo deal.
Microsoft has been rumored to be staging a proxy war inside Yahoo by having the company's shareholders elect a pro-buyout board, eliminating opposition by Yahoo chief Jerry Yang and a group of others determined to maintain the search engine firm's independence.