Microsoft backs out of Yahoo bid
updated 10:10 pm EDT, Sat May 3, 2008
Microsoft Nixes Yahoo Bid
Microsoft on Saturday evening triggered surprise by withdrawing its bid for Yahoo. Company chief Steve Ballmer has validated earlier public comments expressing doubt over the viability of concluding a deal and has revealed that Microsoft offered to raise its bid up to $33 per share in an attempt to win over the Yahoo board of directors, which has insisted so far that the initial $31 per share bid undervalues the search engine giant's worth. The Microsoft executive also states that Yahoo has insisted on a higher-still bid and that his firm doesn't consider an extended proxy effort to install a sympathetic board to be effective.
"After giving this week’s conversations further thought, it is clear to me that it is not sensible for Microsoft to take our offer directly to your shareholders," Ballmer says. "This approach would necessarily involve a protracted proxy contest and eventually an exchange offer. Our discussions with you have led us to conclude that, in the interim, you would take steps that would make Yahoo! undesirable as an acquisition for Microsoft."
Ballmer also confirms that Yahoo's potential alliance with Google is one of the motivating factors behind the decision to cancel the deal. A partial deal with Google would "fragment" Yahoo's search strategy and encourage company developers to leave, negating one of the incentives behind the initial takeover attempt, he says. The deal would also create potential antitrust issues that Microsoft would not want transferred to itself in the event of a successful takeover.
Yahoo is widely known to have been contacted by Google early on and deliberately taken the approach as part of larger "poison pill" strategy, which is believed to have included potential merger talks with AOL.
Microsoft has not outlined its longer-term strategy in the wake of the deal but says that it will continue to pursue its own course in improving its competitiveness in the search advertising space, which in the past has included buyouts of aQuantive and other major web advertising firms.
"By failing to reach an agreement with us, you and your stockholders have left significant value on the table," Ballmer concludes. "But clearly a deal is not to be."
Nebulous
05/03, 11:03pm reply
Who. Writes. This. Stuff? So confusing. Run on sentences, like:
"Company chief Steve Ballmer has validated earlier public comments expressing doubt over the viability of concluding a deal and has revealed that Microsoft offered to raise its bid up to $33 per share in an attempt to win over the Yahoo board of directors, which has insisted so far that the initial $31 per share bid undervalues the search engine giant's worth. "
My god man, hire some people that can write clearly and make sense.
freudling
Mac Elite
Joined: Mar 2005
This is good.
05/03, 11:28pm reply
I'm glad Yahoo fought them off. Yahoo doesn't need to be acquired and Microsoft doesn't need to buy Yahoo.
howiethemacguy
Fresh-Faced Recruit
Joined: Sep 2007
brainz
05/04, 07:22am reply
There would be a big braindrain when MS acquired Yahoo, those two company's don't fit together. Advertising was the biggest reason for MS but the cost would be to high (apparently) and 1+1 won't be more than 2 with a hostile takeover.
Peter Bonte
Fresh-Faced Recruit
Joined: Aug 2001
phew
05/04, 07:47am reply
I won't have to close down my flickr and Yahoo accounts afterall
rytc
Mac Enthusiast
Joined: Jan 2001
Universal Messengers
05/04, 12:31pm reply
Instead of Microsoft trying to buy the competition why don't they work together on opening their code so as to provide consumers with a true universal chat Messenger that supports Audio/Video chat? I thought Microsoft was understanding this when they announced releasing Microsoft Messenger 7 for OS X but the A/V chat ability is only for corporate users and not regular home users. I'd love to see iChat AV have the ability to do A/V chat no matter if you use a MSN email account, Gmail account or Yahoo email account.
imagine engine
Fresh-Faced Recruit
Joined: Aug 2007
"drats! foiled again!..
05/04, 01:54pm reply
...dammit, we might have to actually create something on our own that actually adds value to peoples' lives.
how does one go about that?"
rtbarry
Fresh-Faced Recruit
Joined: Aug 2001
great
05/04, 02:15pm reply
now what am i going to do with all this spam.
Haroscarfel
Fresh-Faced Recruit
Joined: Nov 2007
I agree with nebulous
05/04, 03:19pm reply
I agree with nebulous that the writing for this particular article is horrible. Someone needs to really pay attention their sentence formation. Perhaps they should listen to some podcasts by Grammar Girl among other things.
thibaulthalpern
Fresh-Faced Recruit
Joined: Feb 2008
Writing
05/04, 03:53pm reply
Strunk & White, Elements of Style. A timeless classic that should remain close to your keyboard at all times.
bradpdx
Fresh-Faced Recruit
Joined: Sep 2007
It's not over
05/05, 08:56am reply
Yahoo's stock is tanking in after hour trading! Just like I knew it would. Down over 21%. Now Microsoft can present their $31 share price to the stock holders.
koolkid1976
Fresh-Faced Recruit
Joined: May 2003