Microsoft Adds Pressure to Yang & Yahoo! Board (MSFT, YHOO)

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By Douglas A. McIntyre Updated Published
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Yesterday we noted that Microsoft (NASDAQ: MSFT) may be close to either lowering its bid or taking other actions in its attempt to acquire Yahoo! (NASDAQ: YHOO).  Now the facts are out.  Steve Ballmer sent a letter to the Yahoo! board of directors and discussed the 62% premium offer to Yahoo! January 31, 2008.

Ballmer noted that there has been no meaningful negotiation to conclude an agreement while the public equity markets and overall economic conditions have weakened.  He also noted that public indicators suggest that Yahoo!’s search and page view shares have declined.

Ballmer set the deadline to reach an agreement within the next three weeks, or Microsoft will go hostile and directly go to shareholders.  He will seek to drop change in control procedures, start a proxy contest to elect an alternative slate of directors for the Yahoo! board. and the direct offer to shareholders "will have an undesirable impact on the value"… in short, a lower price will be offered.

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If you’d like to read about Steve Ballmer’s thoughts on the future of search and advertising, Ballmer recently gave some exclusive comments to a673b.bigscoots-temp.com in an interview on this exact topic.

Stay tuned, this one is about to get interesting.

Jon C. Ogg
April 5, 2008

Jon Ogg produces the Special Situation Investing Newsletter; he does not own securities in the companies he covers.

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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