Microsoft Takeover of Yahoo! – No Big Deal
After three months of negotiations Microsoft has finally withdrawn its monstrous takeover bid for Yahoo! Internet group. Looks like the biggest deal in the history of Microsoft Corporation is not going to happen. The two sides failed to reach an agreement despite Microsoft’s intense efforts to purchase the second most popular search engine after Google.
Microsoft placed its initial takeover bid of $44.6 billion hoping that by acquiring Yahoo it will be able to break the dominance of Google on the online search market. However, Yahoo!’s leadership demanded at least another $10bn on top of the offer. Although Microsoft several times raised the bid up to the final $50bn it was still not enough to tempt Yahoo! into a merger.
Microsoft also gave up its plans of a hostile takeover mainly because of a possible Yahoo-Google alliance in search advertising that would mean hard business for the software giant. Microsoft’s CEO Steve Ballmer stated that although he was disappointed with such an outcome he believed in Microsoft’s ability to achieve its business goals without Yahoo!. Experts, however, believe that it will take Microsoft a decade and a serious investment to challenge Google with its own search technology.
On Saturday Ballmer sent a letter to the CEO of Yahoo! to inform him on the withdrawal of the takeover bid. “Clearly a deal is not to be” says the letter released by Microsoft the same evening.