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Analysts: MS being forced to lift Yahoo bid

updated 11:25 am EDT, Tue March 25, 2008

MS May Raise Yahoo Bid

Microsoft may have no choice but to raise the value of its bid for Yahoo, according to a new investment report by Citigroup. Although it started at $31 per share and was characterized as "generous" by Microsoft, the offer is now predicted to increase by an unspecified amount as the Windows developer struggles to overcome resistance by Yahoo's executive board.

Yahoo chief Jerry Yang and others are widely believed to be actively shopping the early search engine company around to other firms, hoping for an alliance or merger that would make Microsoft's hostile buyout attempt prohibitively expensive. AOL, Google, and News Corp. have all at one point been suggested as possible candidates, though neither Yahoo nor any of its rumored partners have confirmed such talks.

Citigroup warns against assumptions that Yahoo is strictly looking to avoid a Microsoft deal and that discussions with other firms may be a pressure tactic. "We believe this could serve as a forcing function to a higher Microsoft bid," the financial institution says.

Microsoft has previously said that it's determined to win its bid, which it hopes will provide a stronger position to attack Google's control of the web advertising and search markets. The Redmond, Washington-based company has said that it will likely take out a loan to pay for Yahoo to avoid draining its cash reserves too quickly.

by MacNN Staff



  1. Deal

    Joined: Dec 1969


    Why not?

    Why not consider Apple as a partner?

  1. danviento

    Joined: Dec 1969


    *Shakes head*

    Um, can you say, duh!

    Yahoo didn't start out wanting to be bought, and later said they didn't want to be. The pressures of litgiation from shareholders (which even a complete moron could see wouldn't hold up) to sell out didn't do it either.

    I don't know what M$ is hoping for. Yahoo owners have been smart enough not to lash their yacht to this sinking liner and be pulled down with them. Pieces like "Vista - the biggest blunder in technology," are signaling to both investors and consumers that M$ is a waning precense in the tech world. I guess if M$ wants to drive down their stock price, that's up to them.

  1. Guest

    Joined: Dec 1969




    The day you buy Yahoo is the day I pull my company from connections with Yahoo.

  1. climacs

    Joined: Dec 1969


    go guest

    I hope there are lots more like you in the high-tech biz, guest.

  1. ZinkDifferent

    Joined: Dec 1969


    Let's be serious...

    ...furthermore, the only reason Yahoo is in the situation t is currently in, is because the services it offers, by and large, suck, and can't compete with better designed services by Google, et all.

    I just recently tried Yahoo's new mail, or looking up information via their financial services, and it was an exercise in frustration - battling unwieldy advertisements, confusing page layouts, and overly crammed pages...

    I ended up heading to Google for the same information/services, where I found what I was looking for quickly, easily, and well-presented.

    As long as Yahoo does not change it's business model in that regard, they will keep tanking.

  1. nat

    Joined: Dec 1969



    Yahoo! makes some weird decisions. I used to use their TV listings, they changed it, it's a mess, now I use AOL for the same well designed simplicity that Yahoo used to have. Who thunk of this? Who said let's f$%k up something that works great?

    Too many pages, too difficult to navigate, on and on. And I've been using Yahoo! Plus mail for years but I'm ready to abandon ship the moment MS touches the door handle.

  1. Sabon

    Joined: Dec 1969


    Microsoft is flailing

    Microsoft has been getting a lot of bad PR about Vista and about their other efforts like lamebox360's declining sales (which they blame on shortages cough cough).

    In order to get people to focus on something else, and not knowing what else to do because they have no true leadership there, they decided to try to buy Yahoo.

    The hope is, since they can't do much with Microsoft Live, that maybe if they take over Yahoo that they won't s**** them up and make them more aimless than they currently are.

    In the meantime, Vista is only getting customers because a certain base of customers don't know enough about Vista to stay away from it and buy it when they need a new computer. I feel sorry for the people like me that have to support these computers.

    What Microsoft SHOULD be doing instead of going after Yahoo, is put Steve Balmer out to pasture (that isn't good, he'll yell MILK at the cows) and get a true visionary and leader as CEO.

    Note: I'm not talking about bringing Bill Gates back. He isn't a visionary. Paul Allen bought QD-DOS for Microsoft, later Bill Gates told people to copy Apple's OS look, then OS/2's look, then Apple's OS look again. Copying things isn't being a visionary or leader.

    Since he couldn't compete otherwise, Bill Gates used IBM and his father's law firm to figure out how to control distribution channels with OEMs and retail stores. Too bad it isn't so easy for him with the internet.

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