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Yahoo formally rejects Microsoft bid

updated 10:15 am EST, Mon February 11, 2008

Yahoo Rejects Microsoft

Yahoo today publicly dismissed Microsoft's $44.6 billion takeover bid, setting the groundwork for a long conflict between the firms. The search firm's Board of Directors says it has unanimously rejected Microsoft's offer after believing that the deal "substantially undervalues" Yahoo's worth. The reputation associated with Yahoo's name, its user base, ad investments and finances are all worth more than what Microsoft has proposed, according to the statement.

The company says it has turned to financial institutions Goldman Sachs, Lehman Brothers, and Moelis to help determine the fairness of the deal.

Microsoft has not yet responded to the rejection as of press time, though the news is expected to make any future takeover attempts much more difficult. A leak of the rejection notice this weekend (since proved accurate) revealed that Yahoo is taking a "poison pill" approach to the bid and is reportedly intent on preserving its independence by either rendering any deal too expensive or else turning to Microsoft rivals such as Google for an alliance that could raise antitrust concerns in the event of a Microsoft buyout.

The bid was originally proposed by Microsoft as an attempt to thwart Google, which has continued to dominate the business for online advertising as well as the still-young web app industry.




by MacNN Staff

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  1. 64stang06

    Joined: Dec 1969

    0

    Good for Yahoo

    Maybe this is a wakeup call to Microsoft that you can't throw money at your problems to make them go away.

  1. Deal

    Joined: Dec 1969

    0

    The bad thing is...

    It's good for both of them. I like Yahoo, but I'd be willing to see them go to watch Microsoft s**** this up and fall on their face.

    I'm a little disappointed as I'll have to wait longer for that inevitable face-fall.

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