SEATTLE, May 2, 2008
Microsoft May Make Hostile Bid For Yahoo
Report: Software Giant Leaning Toward Aggressive Takeover Of Struggling Internet Icon
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Microsoft Chief Executive Steve Ballmer, left, told employees in a company assembly Thursday that he knows how much he'd spend to buy Yahoo and accelerate his company's Internet play. Meanwhile, Yahoo CEO Jerry Wang, right, is exploring a possible advertising partnership with Internet search leader Google Inc. or a merger with the online operations of Time Warner Inc.'s AOL as possible defenses if Microsoft tries a hostile takeover. (AP)
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Citing unnamed people familiar with the matter, The Wall Street Journal reported early Friday that the world's largest software maker may be preparing to go straight to Internet pioneer Yahoo's shareholders.
An announcement was "likely" to come Friday, according to the report, though the newspaper said its sources cautioned that Microsoft may delay.
Chief Executive Steve Ballmer told employees in a company assembly Thursday that he knows how much he'd spend to buy Yahoo and accelerate his company's Internet play.
"We're willing to pay for that at some level, and beyond that level we're not willing to pay for it. I know exactly what I think Yahoo is worth to me," the executive said. "I won't go a dime above, and I will go to what I think it's worth if that gets the deal done."
But he didn't offer a figure, and he didn't say whether Microsoft is considering raising its unsolicited bid, worth $44.6 billion at the time it was made in early February.
"With the right circumstances it'll happen. Without the right circumstances it won't happen," Ballmer said in an interview with The Wall Street Journal.
The offer is currently worth about $42.4 billion, or $29.48 per share, based on Microsoft Corp.'s closing stock price Thursday. Yahoo Inc. has rejected the offer, saying it undervalues the company. Microsoft's board has been considering whether to raise the bid to as much as $33 per share, according to The Wall Street Journal.
Ballmer didn't provide any new insight into the company's efforts to buy the Silicon Valley pioneer during the meeting at Microsoft's Redmond, Wash., headquarters, but he did indicate that an end to months of speculation was near.
"We ought to announce something in relatively short order," Ballmer told employees.
His comments were first reported by Silicon Alley Insider, an online technology news site, and confirmed by a Microsoft spokesman.
Ballmer added that buying Yahoo is just one of many moving parts in the software maker's strategy to compete with Google Inc. in search and Web advertising, and that if neither a friendly nor a hostile deal "look good," he's willing to walk away.
Microsoft's board met Wednesday but reached no decision on a next step, the Journal reported. The software maker had given Yahoo until last weekend to agree to a deal or face the prospect of an ugly proxy fight.
Should Microsoft pursue a hostile approach, it would risk losing many key Yahoo employees. Yahoo would most likely require Microsoft to remove its board, should Yahoo be acquired in a hostile takeover, reports The Wall Street Journal.
Meanwhile, Yahoo is exploring a possible advertising partnership with Internet search leader Google Inc. or a merger with the online operations of Time Warner Inc.'s AOL as possible defenses if Microsoft tries a hostile takeover.
Impressed by a two-week test completed last month, Yahoo could firm up a long-term deal within a week, according to the Journal. Any alliance between Yahoo and Google would face intense antitrust scrutiny, however, because the two companies control more than 80 percent of the U.S. market for search advertising.
Yahoo and Google hope to allay those concerns by structuring their deal so their rivals, including Microsoft, could participate in an auction-based system, the Journal said.
© MMVIII, CBS Interactive Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.
Add a Comment See all 12 Comments
- "I am not a big Fan of Yahoo yet if they do an AOL Deal I would not ever use then and would cancel my Yahoo accounts Imeadiately."
-hissteps4u, Your Yahoo accounts. Are you paying for them? If not, then cancelling them would hardly be an inconvenience or punishment for Yahoo, actually it would reduce their expenses to lose a free email customer. If you are paying Yahoo, WHY? HOW? - Reply to this comment
- AOL tried to charge me an extra $20 to keep my subscription for an extra month at ''no charge'', but billed me anyway. Although it was hardly worth my time to fight the $20 charge, I decided it was moraly responsible for myself and the benefit of others to keep thier non-English speaking reps and upon escalation, English speaking reps on the phone long enough to cost them far more than the $20 they charged.
I think I was on the phone with AOL reps for a total of 8 hours about this issue. So, by the time AOL paid for their ''contracted, read a script only ''help'''' and the supervisors, and the American help, and escalating to more supervisors, in addition to their cost for the 1-800 calls and building and energy expenses, even if I hadn''t got my $20 back, I was very sure many times over that I got my money back in the form of wasting AOL''s time for being dishonest.
So, as a result, I got my $20 back and cost AOL much, much more in doing so throughout the process.
Moral of the story: If a company treats you so badly, then keep them on the phone till it is no longer in their interest to keep you as a customer. Finally, they will release you from their grips. - Reply to this comment
- How can MicroSoft go directly to Yahoo''s shareholders? Privacy laws ought to keep outside firms from determining who another firm''s shareholders are. Are companies selling this information these days?
- Reply to this comment
- AMERICANS NEEDS TO STRIKE........NO ONE WORKING FOR A WEEK OR SO WOULD TELL THE GOVERNMENT ONE THING, THEY CANT DO ANYTHING WITHOUT US AMERICANS WORKING FOR THEM AS SLAVES, SO IF EVERYONE WOULD NOT WORK FOR A COUPLE OF WEEKS, DONT BUY ANYTHING, DO NOTHING FOR A WEEK SEE HOW FAST THE GOVERNMENT STARTS LISTEN TO US.........COME ON AMERICANS WHAT WAITING FOR BUSH/CHENEY TO DECARE A STATE OF EMERGENCY BEFOR YOU WAKE-UP
AND FOR BLACKWATER, ANYONE THATS WANTS TO GET PAID TO KILL AMERICANS SHOULD BE SHOT THEMSELVES, THEY WORK FOR CHENENY AND CHENENY ONLY. WAIT UNTIL THEY USE THEM TOWARD AMERICANS WHEN THEY DECLAIR A STATE OF EMERGANCY JUST BEFORE THEY STRIKE IRAN - Reply to this comment
- BTW...just for fun. Look up the Whois listing on Microsux and see when they registered their domain...1991. Apple registered theirs in 1987! For those who don''t remember...Microsoft thought that the World Wide Web was a FAD! They weren''t even interested in it until other INNOVATIVE companies started doing things on the web. The company has no innovation whatsoever on their own...instead, they must STEAL it from other companies.
Q: What do you call Microsoft''s R&D Department?
A: Apple!
Q: How many Microsoft engineers does it take to change a light bulb?
A: NONE...Microsoft declares "darkness" an industry standard. - Reply to this comment
- Microsoft sucks. They take over little guys and destroy them. They should''ve been shut down years ago when Apple sued them...they play dirty.
Fight, Yahoo, fight! Band together with companies that are HONORABLE, like Google. Never give in. Microsux will take whatever pieces of Yahoo they want, and destroy the rest. - Reply to this comment
- AOL does suck it is the worst of the worst.
Posted by hissteps4u at 12:12 PM : May 02, 2008
Suck is too kind a word to describe AOL.
They''re crooks!
They scammed me of $110, with phony online charges a few years ago! - Reply to this comment
- Microsoft''s always in the business of buying losers.
Yahoo may turn out to be the biggest one yet!
This whole internet thing is one big scam!
Watch out for google to fall next! - Reply to this comment
- AOL does suck it is the worst of the worst. Glad I dumped them years ago. I will give them their due they got the internet business Moving but failed to change with the times. Their platform is horrible and so restrictive.
I am not a big Fan of Yahoo yet if they do an AOL Deal I would not ever use then and would cancel my Yahoo accounts Imeadiately.
fortunately I use a very different internet provider but do use Yahoo and Google for my online business. - Reply to this comment
- AOL is horrible.... beyond horrible.... yahoo would do well to do something somewhere with Google... Merge with GMail or something but AOL is bad news.
AOL to my memory has the worst security "situation" out of all the email platforms you can find. - Reply to this comment
- Great. So in the near future we can expect Yahoo to take giant steps backwards in its functionality, like MS Office 2007, or to crash every other time we use it like most MS software? How do I turn Yahoo off and back on again to get it working?
- Reply to this comment
- Yahoo is in Microsoft sights, we know what will happen.
- Reply to this comment
How gold pays for 
