Microsoft set for hostilities as Yahoo! deadline expires

Search Engines

28 April 2008

The deadline for Yahoo!'s response to an offer by software giant Microsoft has expired this morning, suggesting a hostile takeover could be about to commence.

Microsoft had said it would give Yahoo! until Sunday to accept the bid, but the search engine provider has so far proved resistant to overtures from Bill Gates' company.

A proposed offer of $44.6 billion (£22.4 billion) has been snubbed by board members, with Yahoo! keen to retain its independence.

In a response to the initial offer published earlier this month, chief executive Jerry Yang and chairman Roy Bostock made clear their preference.

Citing Yahoo!'s "global brand, large worldwide audience, significant recent investments in advertising platforms and future growth prospects", Mr Yang and Mr Bostock said the decision to reject the "unsolicited bid" had unanimous backing.

"We continue to believe that your proposal is not in the best interests of Yahoo! and our stockholders," they wrote.

Microsoft is now expected to take the offer to the next stage and consider targeting Yahoo! shareholders or members of the board to try to gain backing.

However, Microsoft has seen its share price stumble in recent weeks, which could weaken the value of any equity offered as part of the deal.
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