Feb 11
It is official now…Yahoo has rejected Microsoft’s offer. Alas a sigh of relief for Google.The reason – Yahoo finds it too low. As I’ve already mentioned in my previous post, Yahoo was offered $44.6bn (£22.4bn) in cash and shares by the software giant Microsoft to compete with Google. The offer was actually 62% above the level at which Yahoo stocks were trading when it was made on 1 February. But somehow Yahoo’s shares closed on Friday at $29.20. So, it was very much sure that the offer was going to be rejected.
Yahoo said the offer “substantially undervalues” the company and is not in shareholders’ interests.
A source quoted by the Wall Street Journal said that Yahoo’s board would be unlikely to consider anything below $40 per share which would be a 109% premium to the $19.18 closing price of Yahoo’s shares the day before the original offer was announced.
Also the thing to keep in mind is that Yahoo’s shares have not traded above $40 for two years.
Let’s see what Microsoft’s next move is going to be.
written by rajit
\\ tags: google, Internet, internet war, Yahoo rejects Microsoft offer
Feb 02
Everyone knows that Google in the king of search engines. Even top companies like Microsoft and Yahoo haven’t been to shake it even a bit from its throne. And the latest news is that Microsoft has offered to buy the search engine company Yahoo for $44.6bn (£22.4bn) in cash and shares. This clearly shows how bad Microsoft wants to get Google down.
Both Microsoft and Yahoo have been suffering serious losses. Yahoo shares have fallen 46% since reaching a year-high of $34.08 in October. They closed almost 48% higher on Friday. Yahoo cut its revenue forecasts earlier this week and said it would have to spend an additional $300m this year trying to revive the company. Same is with Microsoft as it closed 6.6% lower. So, this looks like Microsoft’s attempt to rise up and give Google some competition.
In a conference call, Microsoft’s Kevin Johnson said that the combination of the two companies would create an entity that could better compete with Google.
Anyways, this was just an offer (a fantastic offer) and Yahoo is not compelled to accept it in any way. Yahoo still has to evaluate the offer carefully from their share holder’s view-point though Microsoft has made it clear that Yahoo shareholders could choose to receive either cash or shares. Even if Yahoo accepted the offer, competition authorities both in the US and the European Union would be likely to investigate the tie-up.
written by rajit
\\ tags: internet war, Microsoft wants to buy Yahoo
