Yahoo
Microsoft Chief Executive, Steve Ballmer, has had enough of Yahoo!'s
procrastinations over the software
giant's $31-a-share bid made over two
months ago, it seems.
That bid, represented by a cash-and-stock deal, was worth
$44.6bn
at the time - some 62 per cent above Yahoo!'s trading price
on January 31, 2008.
Yahoo! initially turned the hostile bid down, as we reported here,
and Ballmer's frustration has boiled over and been manifested in a
letter
sent to Yahoo!'s brass a couple of days ago.
"During these two months of inactivity, the Internet has continued to
march on, while the public equity markets and overall economic
conditions have weakened considerably, both in general and for other
Internet-focused companies in particular. At the same time, public
indicators suggest that Yahoo!’s search and page view shares
have declined. Finally, you have adopted new plans at the company that
have made any change of control more costly."
Ballmer clearly cites the current economic climate as being
disadvantageous for Internet-based stocks, intimating that Microsoft's
original offer won't be increased and, if anything, reduced.
Tellingly, Ballmer's scribed fulmination ends with a chilling message:
"If we have not concluded an agreement within the next three weeks, we
will be compelled to take our case directly to your shareholders,
including the initiation of a proxy contest to elect an alternative
slate of directors for the Yahoo! board. The substantial premium
reflected in our initial proposal anticipated a friendly transaction
with you. If we are forced to take an offer directly to your
shareholders, that action will have an undesirable impact on the value
of your company from our perspective which will be reflected in the
terms of our proposal"
The current offer is due to expire on April 26th, and the ball is now
firmly in Yahoo!'s court. Microsoft will go as far as requesting that the incumbent board be replaced by pro-acquisition members. The question is, we suppose, will they
succumb to the heavy-handed tactics employed by Microsoft? After all,
who else has the gravitas to pay near-$50bn for Yahoo!?
HEXUS.channel has further analysis of the story here.
