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Ballmer says he won't pay a dime more than he thinks Yahoo is worth

In February 2008 Microsoft made an unsolicited offer to buy Yahoo for $44.6 billion in cash and stock options. Yahoo’s board of directors turned the offer down stating that the offer undervalued the company.

At the time the offer was tendered the $44.6 billion deal placed a 62% premium on what Yahoo stock was selling for. Since the initial offer was made and rejected much has transpired in the Microsoft/Yahoo saga with things taking a turn for the worst leaving Microsoft to consider a hostile takeover of Yahoo.

The Wall Street Journal reports that sources close to the deal say that as of yesterday Microsoft is leaning towards a hostile takeover attempt of Yahoo. According to the Wall Street Journal the announcement from Microsoft that it intends to pursue a hostile takeover could come as early as today.

Steve Ballmer offered no comment on when Microsoft would make its decision public and simply said, “With the right circumstances it'll happen. Without the right circumstances it won't happen.”

While Microsoft had said its initial offer was a fair valuation of Yahoo, and many agreed, it did indicate this week that it would consider upping the offer to $33 per share to avoid a hostile takeover bid. Major Yahoo stock holders say that an offer of $35 to $37 per share could make the deal happen.

A Microsoft spokesman released a statement made by Ballmer to employees after a meeting Thursday night. Ballmer said Microsoft wouldn’t pay a dime over what he thought Yahoo was worth. Ballmer said, “I will go to what I think it's worth if that gets a deal done.”

Ballmer maintains that Microsoft can get to where it wants without the Yahoo buy, but that it would just take longer. Microsoft maintains that it has the technology for a successful ad operation; it simply lacks the scale to go against Google.

Ballmer continued, “We like our strategy. We don't like our position. I’d like to have a better position relative to the guy who sells the most advertising.”

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By Screwballl on 5/2/2008 3:23:43 PM , Rating: -1
What better way to expand your monopoly in the name of "competition" than to forcefully take over another company. What happened to corporate freedom to decline a merger or buyout?
Yet another reason to continue using Google.

RE: monopoly
By TomZ on 5/2/2008 3:36:20 PM , Rating: 2
Nice try, but what about Microsoft's right to purchase Yahoo shares on the open market? What about Yahoo shareholder rights to get more value for their investment relative to what Yahoo's board is currently providing?

After all, the final decision will be up to Yahoo shareholders to decide whether the Microsoft offer, hostile or otherwise, makes sense for them. The only people who lose the ability to influence in a hostile takeover is the current board, and maybe rightly so.

RE: monopoly
By rudy on 5/2/2008 5:07:26 PM , Rating: 2
You sold that when you went public.

RE: monopoly
By bryanW1995 on 5/2/2008 7:26:06 PM , Rating: 2
what? they can decline if the want to. A hostile takeover simply takes the matter to the shareholders. The shareholders will probably accept a hostile takeover b/c the alternative is that they become the next aol.

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