Microsoft walks away from Yahoo
Submitted by srlinuxx on Sat, 05/03/2008 - 21:59.
Software giant Microsoft has dropped its three-month-old bid to buy internet firm Yahoo because the two sides cannot agree on an acceptable sale price.
Microsoft chief executive Steve Ballmer formally withdrew the offer in a letter to Yahoo chief executive Jerry Yang.
Mr Ballmer said Microsoft had raised its original offer from $44.6bn to $47.5bn (£24.1bn) - $33 per share.
But he added that Yahoo had insisted on at least $53bn, or $37 a share - more than Microsoft was prepared to pay.
The software giant had wanted to do a deal to be able to compete with Google, which dominates the lucrative market for internet advertising.
This market was worth $40bn in 2007 and is predicted to double to $80bn by 2010.
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Heard at Tuxmachines first ? Microsoft had other options ?
This confirms Yahoo overpriced itself for an exit strategy. Jerry Yang should have looked at the microsoft growth to price the Yahoo stock for stock not cash exchange. The deal from Yahoo's stockholder's viewpoint has to be Microsoft stock exchange, then help Microsoft to build stockholder value. Cash buy out for Yahoo is an exit strategy for their stockholders. Yahoo has search engine and webpage layout in market value, but its market strategy is limited at best.
Microsoft has dialup customers, but not advertizing customers. This can change by windows 7 strategy and get advertizing on cellphones. Cellphones will be pixel webpages, with icons for advertizing clicking?
The webpage war of (?)html, yahoo html plus motion jpeg, and Microsoft xml will be dwarfed by cellphone advertizing on new format with the ease of purchase order activation?
Microsoft looks like got off overpaying gracefully for now. Now, we can concentrate on Windows 7 development and cellphone application(MSN Mini) at the same time.
We are stockholders of Msft. Opinions here maybe biased.
Not over until the fat lady sings
It's not over until the fat lady sings, as the old saying goes. They could just be playing psychological games hoping that Yahoo shareholders will sue or pressure the board by proxy. Wait before popping the bubbly.
Microsoft had debt ? For cash buyout ? Fat lady sung for SB ?
Yahoo direction is unclear, but MSFT had a wild dream. Wall street analysts tried to rescue Yahoo indirection for stockholder's value? Jerry Yang took the easy way out with Google ads. AOL(dialup customers) did not have good results with Google ads.
Fat lady sung when Steve Ballmer got nervous about Yahoo revenue this quarter? Microsoft operations had built in losses each year, which makes carrying big debt a big worry? Bill Gates may have to come back with Buffet's philosophies?
Yahoo has to follow with Internet SOA apps(in pixels by zooming conversion of their webpages)? And have cellphone access to have value?
Quite so
If they accepted the $34-a-share bid, Microsoft would have to borrow about $30bil from the bank. That's how bad they do, Enron style. They have assets but they massage figures.