Sources close to the matter claimed that Yahoo’s board felt that Microsoft’s $44.6 billion buyout offer undervalued the company. Apparently, the company’s board held a special meeting last Friday to discuss Microsoft’s offer. While a hostile takeover attempt is possible, Microsoft may be reluctant to pursue that avenue since it could cause key employees to leave. Microsoft is more likely to bump its offer up above its current $31 a share price point, but Yahoo is looking for at least $40 a share — a number Microsoft may not be willing to meet because it would add an additional $12 billion to the deal. Yahoo is expected to notify Microsoft of its decision by letter sometime on Monday.
Yahoo is seeking to restart merger talks with the AOL unit of Time Warner as a way to defend itself from a hostile Microsoft approach, The Times (of London) newspaper reported Monday, citing an unnamed source. The report said tie-ups with Google and Disney also are being explored. The report said “it is understood,” that the board will not even consider starting talks with Microsoft unless the suitor group offers at least $12 billion more, representing a share price value of more than $40. (The Mac Observer, Marketwatch)
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