Deadline Passes on Microsoft’s Yahoo! Bid

REDMOND, April 28: The
deadline for Yahoo! to come to a decision on Microsoft’s $42.7-billion offer
passed this weekend with no announcement from either side and the looming
possibility of a hostile takeover bid.

On April 5, Microsoft’s
CEO, Steve Ballmer, stated in a letter to Yahoo!’s Board of Directors that if
the April 26 deadline was not met, “We will be compelled to take our case
directly to your shareholders, including the initiation of a proxy contest to
elect an alternative slate of directors for the Yahoo! Board. The substantial
premium reflected in our initial proposal anticipated a friendly transaction
with you. If we are forced to take an offer directly to your shareholders, that
action will have an undesirable impact on the value of your company from our
perspective, which will be reflected in the terms of our proposal.”

According to reports,
Microsoft is expected to make a decision on its next step this week. The Wall
Street Journal indicates that Ballmer
is dealing with opposition from within Microsoft, with some executives
concerned that a hostile takeover of Yahoo! would divert resources away from
fixing the company’s own problems.

Yahoo maintains that
Microsoft’s offer "substantially undervalues" the search engine
giant.

—By Mansha Daswani