TAG | Microhoo dead? Microsoft and Yahoo part ways – for now |
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| by Alex Zaharov-Reutt | |
| Sunday, 04 May 2008 | |
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Page 3 of 3 In addition, it would raise a host of regulatory and legal problems that no acquirer, including Microsoft, would want to inherit. Among other things, this would consolidate market share with the already-dominant paid-search provider in a manner that would reduce competition and choice in the marketplace. It could foreclose any chance of a combination with any other search provider that is not already relying on Google’s search services. Accordingly, your apparent plan to pursue such an arrangement in the event of a proxy contest or exchange offer leads me to the firm decision not to pursue such a path. Instead, I hereby formally withdraw Microsoft’s proposal to acquire Yahoo!. We will move forward and will continue to innovate and grow our business at Microsoft with the talented team we have in place and potentially through strategic transactions with other business partners. I still believe even today that our offer remains the only alternative put forward that provides your stockholders full and fair value for their shares. By failing to reach an agreement with us, you and your stockholders have left significant value on the table. But clearly a deal is not to be. Thank you again for the time we have spent together discussing this. Sincerely yours, Steven A. Ballmer Chief Executive Officer Microsoft Corporation +++ Yahoo’s press release is as follows: Roy Bostock, Chairman of Yahoo! Inc., a leading global Internet company issued the following statement today in response to Microsoft Corporation's announcement that it has withdrawn its proposal to acquire Yahoo!: "We remain focused on maximizing shareholder value and pursuing strategic opportunities that position Yahoo! for success and leadership in its markets. From the beginning of this process, our independent board and our management have been steadfast in our belief that Microsoft's offer undervalued the company and we are pleased that so many of our shareholders joined us in expressing that view. Yahoo! is profitable, growing, and executing well on its strategic plan to capture the large opportunities in the relatively young online advertising market. Our solid results for the first quarter of 2008 and increased full year 2008 operating cash flow outlook reflect the progress the company is making. Today, Yahoo! has: -- a refined strategic focus to drive enhanced volume and yield; -- reorganized to focus its efforts on its most promising products and services; -- invested in innovations designed to revolutionize display advertising and facilitate closing the competitive gap in search; and -- enhanced expense and resource management to support improved profitability." Jerry Yang, co-founder and chief executive officer, Yahoo! Inc. added, "I am incredibly proud of the way our team has come together over the last three months. This process has underscored our unique and valuable strategic position. With the distraction of Microsoft's unsolicited proposal now behind us, we will be able to focus all of our energies on executing the most important transition in our history so that we can maximize our potential to the benefit of our shareholders, employees, partners and users."
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