Yahoo Inc. spurned Microsoft Corp.s $44.6 billion takeover bid as inadequate
Monday without explaining how its management will match the payoff that the
slumping Internet icons shareholders would have received had the unsolicited
offer been accepted.
** Check out our
Yahoo Phone Card
The rebuff had been widely anticipated after word of Yahoos intention was
leaked during the weekend.
In its formal response, Yahoo said its board had concluded Microsofts
unsolicited offer "substantially undervalues" the Sunnyvalebased company.
Yahoos stock price had dropped by more than 40 percent in the three months
leading to Microsofts bid, which was valued at $31 per share when it was
announced Feb. 1. The offer represented was 62 percent above Yahoos market
value at the time.
By rejecting Microsoft, Yahoos board appears to betting that it will be able to
extract a higher offer from the worlds largest software maker or its management
team will finally be able to deliver on its repeated promises of a turnaround
that has been in the works for the past 18 months.
Many analysts believe Redmond, Wash.based Microsoft will eventually raise its
bid to $35 to $40 per share, sweetening the pot by $5 billion to $12 billion in
an effort to negotiate an amicable sale.
Alternatively, Microsoft could take its original bid directly to Yahoos
shareholders. If it goes down that route, Microsoft might have to antagonize
Yahoo by trying to oust the 10member board the rejected the original offer.
Microsoft representatives didnt immediately respond to requests for comment
Yahoo shares rose 62 cents, or 2 percent, to $29.82 in early trading Monday
while Microsoft shares lost 24 cents to $28.32.
Tag Clouds: Yahoo Calling Card,
Phone Card Yahoo,
Yahoo Calling Card