Yahoo may reject Microsoft offer

Posted on February 11, 2008
Filed Under Business |

What is this I am hearing? Yahoo may reject Microsoft’s offer of US$44 billion. Is Yahoo thinking it may be able to get more than $31 per share that Microsoft is ready to offer? If so, who could it be that might offer more than what Microsoft has to offer?

Looks like one of the Wall Street Journal source said that Yahoo’s board will not consider anything below $40 per share, knowing that they never traded above 40$ in the past 2 years. Knowing the way the wind is blowing, I personally do not think its a good idea for Yahoo to put such a demand, specially in a year when recession is looming large and many businesses may cut down their advertisements which would affect Yahoo’s already flagging revenue.

At $40 a share its a 109% permium to the $19.18 closing price of Yahoo’s share the day before Microsoft announced its offer. Yahoo share prices have fallen sharply in the past two years, however Yahoo’s websites remain among the world’s most popular even today.

Interestingly enough Microsoft’s shares have fallen 12% since it made its offer, and I feel its mainly because of the concerns that it has already offered too much and its a big deviation from it;s core software business.

Let’s see how the market opens tomorrow for both of these companies.

Comments

One Response to “Yahoo may reject Microsoft offer”

  1. Sandeep on February 11th, 2008 6:56 pm

    Yahoo has officially rejected the Microsoft offer, as per the latest news.

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