Wow, Microsoft Walks Away

I was blown away from yesterday's news of the status of Microsoft/Yahoo's bidding war. I have been predicting over the past few months that Yahoo would put aside its pride and see the benefits of a merge with Microsoft and succumb to its offer. Apparently, even after Microsoft raised its bid to $33 a share (which in itself was not was predicted) Yahoo's CEO Yang wouldn't accept less than $37. Come on, does $4/share make that much of a deal breaker? I guess it does enough for Yahoo to stubbornly hold ground and Microsoft to pout and withdraw its bid.

Some experts have speculated that this is just another one of Microsoft's tactics to have Yahoo eventually come crawling back. Others say, Yahoo is now scrambling to make a deal with Google despite its weakened negotiation leverage. The shareholders are fuming mad since most were more than happy to settle for Microsoft's $33/share offer. What is the fate of Yahoo? Whatever they decide to do, there's little chance they'll have the opportunity again to be in a respectful power of position as a major competitor.

Yahoo's Up To Serve: Part 2

In my previous post of "Yahoo's Up to Serve" a couple of months ago, I predicted Yahoo would eventually succumb to Microsoft's bid. In an email from Microsoft's CEO to Yahoo's Board of Directors yesterday, it seems apparent that match point is near. There is no mention of a bid increase or a proposed Yahoo board slate. Yahoo is supposed to release their Q1 earnings in the next two weeks and there's some buzz that a negotiation might be made prior to their announcement. Other commenters say this is Microsoft's way of saving face prior to the cancellation of the deal. Either way, be on the look out for major changes within the next coming weeks that will rock the digital media industry. 

Yahoo's Up to Serve

For a while now, I've been holding my breath around the discussion of Microsoft and Yahoo's tiff. But with Microsoft's announcement today of its proxy battle authorization for the company that snubbed its bid last week (a move that will prove cheaper than raising its original bid), my curiosity grows and the drama just keeps getting better. The ball's in Yahoo's court now.

Many people wonder, did Yahoo make a mistake by rejecting the Microsoft offer? It is said in other reports that Yahoo's board could be vulnerable in this proxy fight since all of its directors are up for nomination this year, and in accordance with its bylaws they're elected by a plurality of votes cast in a contested election. Supposedly the senior executives at News Corporation don't expect anything to happen with their discussions with Yahoo over a possible merger and Time Warner seems to be skeptical.

With Google somewhat rooting for Yahoo from the stands, it would still prove to be hard times for Yahoo if they announced a deal with the internet Giant. It's unlikely the shareholders would believe that the money from search alone would be enough to back Yahoo's reasoning for turning down Microsoft.

My two cents is Yahoo's putting up a fight it won't win. Either Microsoft is going to get its way or Yahoo will have to settle for less which would be less than ideal to the prior. I'm grateful everyday I didn't get that job offer from Yahoo back in 2007 and wish the best for its employees in the coming months.