Microsoft pulls its Yahoo offer
Update 5 p.m. PDT: Microsoft has made its move official. Click here for the story and here for the text of a letter Ballmer sent to Yang.
Microsoft is withdrawing its offer for Yahoo after talks between the two companies broke down on Saturday, a source told CNET News.com.
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Microsoft hiked its offer to $33 a share, but Yahoo was holding out for $37 a share, the source said. The two sides met face to face again Saturday, but remained far apart.
Although price was a key issue, Microsoft also had strategic concerns and saw it as unlikely to achieve a friendly integration process. According to a source close to Microsoft, Yahoo founder and CEO Jerry Yang had "unrealistic expectations."
Microsoft made its $31 a share cash and stock offer on February 1. Yahoo rejected the bid as undervaluing the company, and the two sides had only the most basic of negotiations until Microsoft set a three-week deadline last month. Negotiations heated up on Friday, but the two sides remained far apart.
The move leaves both companies in a tenuous spot. Although Microsoft has said it has a strategy to take on Google without Yahoo, Yahoo represented the biggest opportunity for Microsoft to gain scale against its rival, which has a much larger Internet advertising business.
Yahoo, meanwhile, has had talks with AOL and Google, but it is unclear whether deals with either would produce the kind of immediate return for shareholders that a Microsoft deal would offer.
Microsoft is expected to announce its move publicly shortly, according to the source.
During her years at CNET News, Ina Fried has changed beats several times, changed genders once, and covered both of the Pirates of Silicon Valley. These days, most of her attention is focused on Microsoft. E-mail Ina.
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It would have been fun to watch. *sigh
At least we still have Vista, Office 2007, and the Zune to laugh at.
...but, common-sense demands that we should shun, if not actually fear, Vista.
...And, Office 2007 just isnt really that bad. Insanely overpriced, perhaps... certainly a useless upgrade... and it fills no actual need, maybe. But, as a product attempt, I think it is too sad to actually laugh at it. Hhhmmm... Come to think of it... Office 2007 kinda, also, sounds like most of Microsofts latest products, doesnt it..?
Just, my two-cents...
Very sad.
We, still have some worthy entertainment provided by Redmond. As said at least we can get our laughs at Vista, Office, OneCare and so on. And should Microsoft had successfully acquired Yahoo (bottom feeder not worth the offer) what a SOAP-OPERA that would have been.
Very sad.
What's next for Yahoo? Buying AOL, I hope so...
First, it was an idea only you could hatch with a straight face.
Second, it was a really stupid idea.
Third, only one company hates MSFT more than Yahoo! and only
now coming to the conclusion that the company was "unlikely to
achieve a friendly integration process" is really a sign of early
onset Alzheimers. Consult with your doctor.
Steve, hello. Clue. Yang is a Lotus guy. Remember all those
underhanded schemes MSFT used to kill Lotus Smart Suite, you
know, the ones for which MSFT had to settle with IBM some
years back? Think this might have influenced Yahoo!'s culture
and have something to do with the fact that everyone at Yahoo!
who can put on their socks without pictorial instruction would
rather go on a diet of camel smegma than work for MSFT?
Anyway, congrats on another disaster that could not have been
more calamitous if you'd planned it.
Its a sad day for Yahoo, their over inflated egos got the better of them.
Now is Jerry Yang going to be forced out?
vista). Who else is there left to borg?
It was Balmer's greed not Yang's that started this.
Now we shall see Google slowly assimilate Yahoo with no
resistance.
Nah - they were fading away before, but not now.
/P
What would make sense for MS would be to actually produce a high quality product that people want to use.
How did MS lose sight of that?
Whether unreasonable or not, Yang and Company have said defiantly to Balmer and Company that they're not willing to fit the mold of a company (Microsoft) that obviously and demonstrably has no clue how to succeed in the Search Wars (as evidenced by the complete failure of Live Search). Microsoft's archaic thinking of innovation through acquisition helps nobody, and its been a pleasure to see them so openly feared throughout this process.
GOOD for you Yahoo...stick to your guns. We all know you'd like to defeat or even compete more appropriately with Google, but it victory (or even success) won't come at the bequest of a company that only sees you as a cog in their machine. Do your own thing, get smarter...and for God's sake avoid Microsoft. You don't need them.
Yahoo wanted more money than it is worth, is it a good thing, I dont know. Did they stand-up for something? Certainly not, they just wanted more money being ego-centric that Yahoo has become, there is nothing achieved here. Yahoo's existence will depend on its performance down the road, it has not been great lately anyway.
Just to boost their stock, yahoo will try another round of lay-offs and restructuring etc. to keep the angry shareholders away and pray something really great happens. They can do all the wheeling and dealing and ribbon-cut a whole highway of platforms, but their stock will never realistically make $36 they demanded from Microsoft, not in another 5 years.
This will be immensely damaging.
?Developers, developers, developers?...get a clue, ballmie.
Devs are a dime a dozen.
Its ?ideas, ideas, ideas? ... and other people?s ideas are whats beating the crap out of msft, not their developers. Its what their developers are doing....with ideas.
Did you catch that?
My plan B would be to cap ballmie, hes the GWB of msft.
Anybody that feels they have to reach outside msft to such an extent to be competitive, with the resources they have, and in such a damaging way, needs to go.
Now.
He is going to say that they didn't want Yahoo, didn't need them and unveil a plan to unseat Google by spewing the most massive ball of buzzwords ever uttered by 1000 people until he implodes, leaving a massive crater in Redmond.
Either that or he will continue to attempt to buy MS into further irrelevancy.
Boy, Yang really screwed up when he and the other co-owner gave up 51% of the shares... At least Gates did it right in that perspective...
Yahoo doesn't even want to be taken over! The audacity of some
posters and bloggers who believe Microsoft would be Yahoo's
savior. Yahoo was solving their own problems when this whole
Microsoft debacle came along. They just added more problems
to their list! Finally at least thats over with and now Yahoo can at
least get back on track in repairing themselves. And the
industry is now safe from the clutches of a destructive company
hellbent on trying to worm their way in so they can monopolize,
reap and pillage the online search market with their strong arm
business tactics. It may have worked with Bungee but sorry not
Yahoo!
Microsoft was offering $31 per share.
Yahoo demanded more.
Yahoo's stock closed at $28.67 per share.
Umm...someone on Yahoo's side sucks at math. Hope Yang can get the stock up soon or the shareholders are gonna be very angry!
Yahoo had the support of their major shareholders, which in our greed driven culture means everything.
The deal included cash and MS stock. MS stock is stagnant.
If this deal went through the Yahoo shareholders that stuck around would get severely hosed in the end.
How low will it go? Will it go down to pre-merger values? Probably not. I do expect it to stop around $20 though, someplace in the middle.
Yahoo is left without a dance partner.
Where does this put them? They are now in worse condition than before this mess. They had companies interested in buying them before but now- nothing. Will the stock tank? Will the stockholders who were sitting pretty to make a nice healthy fat profit still be happy with the CEO when their stock drops to a fraction of its prior value, for some actually forcing them to take a loss instead of a profit?
I can't help but think this is all a plan by Microsoft. Go in, scare off any competition, let Yahoo struggle, offer a buyout with a set price. Yahoo refuses, everyone backs out and the real value of the company drops like a rock. Wait six months for them to flounder around and the board get changed out and then go in and buy them out for a firesale bargain price.
From a business point of view, it's brilliant.
I'm still against a merger of the two, but I can see where this is going and it doesn't look good for Yahoo unless they can find another partner when everyone's had a chance and has backed out.
It would be very hard for the Trust Busters to oppose these deals. They will increase the level of competition because it will leave Yahoo independent and much stronger.
If anything, MSFT did two things that it never intended:
1) Put Yahoo's name in the news - everywhere. Yahoo was a fading ho-hum name... now it's on everyone's lips (again).
2) Forced Yahoo to do more than merely placate shareholders with half-secrets and vague promises; now there are concrete plans and partnerships that have probably harmed Microsoft more than helped it... even if Microsoft never really intended to buy Yahoo in the first place.
/P
Read the subject line!
FINALLY Microsoft takes the RIGHT (and VERY savvy) decision NOT paying a price THREE times the annual NASA budget to just buy a (little more than a) search engine, like Yahoo surely is!!!
Now they can invest a fraction of the $45 billion to (simply) "build" their own Yahoo from ZERO and SAVE.
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Gaetano Marano - NewSpaceAgency
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Search math is not easy. Relatively few people in the world are any good at it. Most of them Hate Microsoft and would not work for them at any price.
Building a search business also requires a great deal of skill in branding. Microsoft did an excellent job with Windows and Office. With the negatives associated with the Microsoft name, Every attempt they have made post Office (Very bad pun) has failed. I like to think that I have played a small part in this.
Yahoo is number 2.
Microsoft is number 3.
At this stage, it is in Microsoft's logical next move to form a
partnership with Google.
It was obvious MS could not gain anything in the search/ad arena without help. The actions of MS lately prove it. Google needs no such help.
Seems to me there is someone out there at #4 that is lurking and about ready to make a move that we haven't seen yet. What that move may be and with whom, I don't know, but the situation is prime for it.
Anyway this whole fiasco only highlights the fact that Google is kicking Microsoft and Yahoo's butt.
GOOGLE's the one with the balls at the end of the day.
- Microsoft should buy out...
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by t8
May 4, 2008 2:49 PM PDT
- Microsoft should buy out loser.com.
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See all 89 Comments >>The traffic is reasonable and if they partner with Google on the ads, it will pay Steve Bs coffee bill each week.