Feb 20, 2008 114 reads by Navneet Kaushal

Just as many expected that Microsoft's passion for Yahoo would lead it to appreciate it offer, the Redmond giant's stance seems to be just as tough as Yahoo's bold refusal to the proposal.

Rather than increasing the bid even by a cent and justifying the price of $31 per share as fair, the Redmond giant's Chairman, Mr. Bill Gates has reiterated his company's stand on the issue. "We sent them a letter and said we think that's a fair offer. There's nothing that's gone on other than us stating that we think it's a fair offer," said Mr. Gates On Monday. "They should take a hard look at it."

Yahoo on the other hand firmly believes that they have been undervalued and that they are should at least be offered a $40 per share price. Apparently, neither Microsoft's nor Yahoo have budged from their positions. Albeit, Yahoo has been on the lookout for better bids or perhaps alternative alliances with Rupert Murdoch's News Corp and Time Warner.

To begin with the deal was valued at $44.6 billion, but since then, Microsoft's share price has taken a dip of 12.8 percent, thereby altering the value of the cash-and-stock and pushing the offer closer to $41 billion.

It was clear earlier that Microsoft's is not letting the Yahoo slip from its grip, and would do whatever it takes to acquire Yahoo. Falling in line with its stated future course, Microsoft's next move could be to take the offer directly to Yahoo's shareholders, or perhaps to make an effort to a hostile takeover of Yahoo's board. To influence Yahoo's shareholders Microsoft would use their proxy votes to overthrow the board. How successful they would be only time would tell, they have a March 13th deadline to accomplish this feat.

Navneet Kaushal

Navneet Kaushal

Navneet Kaushal is the founder and CEO of PageTraffic, an SEO Agency in India with offices in Chicago, Mumbai and London. A leading search strategist, Navneet helps clients maintain an edge in search engines and the online media. Navneet's expertise has established PageTraffic as one of the most awarded and successful search marketing agencies.
Navneet Kaushal
Navneet Kaushal
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