Microsoft-Yahoo deal may go hostile Friday
Updated: 2008-05-02 21:34
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.
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 US 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.
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