Microsoft abandons $47.5bn Yahoo! bid
Sunday, 04 May 2008 19:54
Microsoft abandons $47.5 billion bid for Yahoo! after firms fail to agree on price
Microsoft has called off its bid for Yahoo! after the internet company rejected a $47.5 billion offer.
A letter from Microsoft chief executive Steve Ballmer to Yahoo! chief executive officer Jerry Yang expressed regret that the two firms could not reach a deal.
Software giant Microsoft, which first unveiled its bid for Yahoo! three months ago, had been willing to pay $33 per share, but the search engine's bosses wanted $37, equal to an extra $5 billion (£2.5 billion).
Mr Ballmer said Yahoo!'s demands "did not make sense" for Microsoft and were not in the best interests of the company.
In reply, Yahoo! chairman Roy Bostock said the Microsoft offer had continually "undervalued" the firm and thanked shareholders for their support.
Microsoft first bid for Yahoo! to position itself to compete with search engine and internet advertising giant Google.
Analysts are predicting that Yahoo!'s recalcitrance to accept Microsoft's advances may send its share price tumbling when markets reopen on Monday.