Alright people,Im sure you have heard about this news before.If you havnt,then Im going to tell you what is it all about.Computer giant Microsoft have recently launch a takeover bid for Internet giant Yahoo,a couple of weeks ago if Im not wrong.The offer is worth 44.6-billion-dollar.I know that is a lot of money and you might think Yahoo would accept it straightaway.However,with a takeover bid which has a magnitude as big as this one,nothing is straightforward.
The latest news from this saga is that Yahoo is rejecting the bid,saying that the bid is too low and not what's best for shareholders of the veteran Internet company.Yahoo issued a statement early in the day saying its board had decided "after careful evaluation" that Microsoft's bid "substantially undervalues Yahoo."As a result,the board "concluded that the proposal is not in the best interests of Yahoo and our stockholders," Yahoo said.Yahoo now,as you know is not having a good time.Yahoo announced it would lay off 1,000 employees by mid-February,it also reported lower fourth-quarter earnings last year and gave a 2008 revenue forecast that disappointed analysts.However,Yahoo still leads in online display advertising revenue and its various web sites are the most visited by U.S. Internet users,and No. 3 worldwide,according to tracking service ComScore.So popularity wise,they are still among the top but financially wise,they are not looking good.
Microsoft meanwhile called the Yahoo board action "unfortunate" and said the bid was "full and fair."And not surprisingly,Microsoft is not backing down and will continue its bid to takeover Yahoo and urged Yahoo to reconsider its blockbuster bid to combine the two tech titans and said it offers "superior value" to Yahoo shareholders.Even thought Yahoo has rejected the initial bid from Microsoft,it is still keeping any future bid options open whether it is from Microsoft or any other company saying,Yahoo "is continually evaluating all of its strategic options in the context of the rapidly evolving industry environment."Of course,the bid must be more than what Microsoft has offered.Now whether Microsoft will increase its offer is yet to be known,but many analyst are thinking that this is part of an effort by Yahoo to get a higher sales price from Microsoft and it certainly looks like it.Another internet giant,Google is of course not happy with Microsoft move and they have been very vocal about it.They has condemned Microsoft's effort as an attack on "the underlying principles of the Internet: openness and innovation." Whether you agree with them or not,or whether you think Google is feeling threaten by the move,you make your own decision.One thing for sure,I dont think they will be able to make a bid for rival Yahoo,but you never knows.
There however has been some report on Monday which says options being considerd by Yahoo now include merging with faded Internet star America Online (AOL),now owned by Time Warner.This is just rumour,theres nothing concrete about it.But if it is,then expect to see some interesting effect.For me,a move with Microsoft would be a great thing for Yahoo because right now,they are struggling and I think Microsoft would offer the helpline that they need,but again,I think Yahoo is a great company and they are able to solve the current crisis on their own.I really doubt that Google will make any move to buy Yahoo or any other company for that matter.So the most probable outcome next would be to see Microsoft raising their offer which I think they would,or decides to drop out.It should be interesting to see what action will Microsoft take next because clearly,the ball is in their hand.
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