In the beginning of 2008, Microsoft had
made an unsolicited offer to buy Yahoo
for $44.6 billion. Transaction valued at approximately $31 per Share for Yahoo that means 62 percent premium to current trading price for Yahoo! shareholders. But Yahoo later rejected the offer saying Microsoft’s bid ‘substantially undervalued’ the company. Recently, Microsoft raised its bid by about $5 billion but now it appears that Yahoo wanted Microsoft to further raise its bid by another $5 billion or more, raising the acquisition size to about $55 billion.
“We have great respect for Yahoo!, and together we can offer an increasingly exciting set of solutions for consumers, publishers and advertisers while becoming better positioned to compete in the online services market,” said Steve Ballmer, chief executive officer of Microsoft. “We believe our combination will deliver superior value to our respective shareholders and better choice and innovation to our customers and industry partners.”
So it is clearly that with Yahoo acquisition Microsoft wanted to compete with search giant Google.
“We clearly indicated to Microsoft that we were open to a transaction but only if it were on terms that fully recognized the value of Yahoo and was in the best interests of our stockholders,” Jerry Yang, CEO, Yahoo, has said. “With Microsoft’s withdrawal, we will be better able to focus our energy on growing our industry leadership and maximizing value for stockholders.”
Steve Ballmer, chief executive officer, Microsoft, has said, “Despite our best efforts, including raising our bid by roughly $5 billion, Yahoo has not moved toward accepting our offer. We believe the economics demanded by Yahoo do not make sense for us, and it is in the best interests of Microsoft stockholders, employees and other stakeholders to withdraw our proposal.”
Lets watch Microsoft next move...........to conquer the online world.
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