White Hat Media News
15/07/2008 | Microsofts New Bid for Yahoo
The Yahoo-Microsoft battle is still continuing with a second proposal now shunned again from Microsoft Corp and activist investor Carl Icahn. The "take it or leave it" attempt to bid for Yahoo's online search operations was described as "completely absurd and irresponsible" by Yahoo and suggested that this would dismantle their Internet franchise.
Yahoo had previously rejected an offer from Microsoft on the 12th of June in favour of a search advertising deal with Google. This represented a bit of irony because Google's domination over Internet search advertising is the main reason why Microsoft pursued Yahoo in the first place. Microsoft's new proposal offered better revenue guarantees from search advertising in which the enhanced terms were to include $2.3 billion in guaranteed annual revenue for five years from search advertising.
Yahoo were given just 18 hours to decide on the latest proposal which would have required the internet giant to instantly sack its top management, sell its stakes into several Asian internet companies and replace its entire board of directors. Roy Bostock stated "It is ludicrous to think that our Board could accept such a proposal".
When Microsoft announced to the public the possibility of the company buying all or part of Yahoo if its shareholders voted to remove the current board, Yahoo shares then climbed 10 percent on the hopes that Icahns support for this proposal might help to seal the deal.
After the offer was put forward by Microsoft, Yahoo's board formed into a conference call and immediately declined, but alternatively offered the chance to purchase Yahoo for $33 a share. Yahoo has yet to explain why it finds a sale at $33 per share to be more acceptable now and more so than it was a little over two months ago when they previously rejected the offer on the 3rd of May. The board also said Yahoo was willing to negotiate a different search-only transaction.
The plans for Yahoo's annual meeting are said to be on the 1st August. Carl Icahn, who owns 5 per cent of the company's stock, will attempt to replace Yahoos board and if he is successful, Microsoft's door for a fresh takeover bid of Yahoo will be opened and ready to be enter. Microsoft however has stated they are no longer interested in buying Yahoo in its entirety unless Icahn's board is involved in the negotiations.
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