Yahoo Execs Meet With Microsoft Counterparts

March 17, 2008

(Long Island, N.Y.) Rivaling companies Yahoo Inc and Microsoft sent company representatives to meet near Yahoo’s Sunnyvale head office in California to discuss possible amendments to Microsoft’s takeover bid which could lead to a breakthrough for merger plans.

A month ago, Microsoft sent an unsolicited $44.6 Billion or roughly $31 per shares of stocks offer to Yahoo Inc. to takeover their operations for the company but was summarily denied by Yahoo CEO Jerry Yang and its board of trustees noting that Yahoo Inc. is worth much more than the initial offer.

“We have great respect for Yahoo, and together, we can offer an increasingly exciting set of solutions for consumers, publishers, and advertisers while becoming better positioned to compete in the online-services market, Today, the market is increasingly dominated by one player, who is consolidating its dominance through acquisition, together Microsoft and Yahoo can offer a credible alternative ” Microsoft CEO Steve Ballmer said in a statement.

According to sources close to the negotiations and speaking on terms of anonymity, the meeting occurred last Monday near Yahoo’s headquarters and both companies sent top executives to discuss a possible solution to their current stand-off. Microsoft re-iterated that it would not increase its offer to accommodate Yahoo’s wishes but industry experts surmise that it is a necessity for Microsoft to do so if it pursues its intentions of buying the troubled search-engine company.

Yahoo Inc. generated dismal sales report from the last three months of last year up to the early parts of this year in its quarterly reports which prompted the company to incorporate cost cutting measures such as the closures of multiple company owned retail outlets nationwide and the reduction of its total manpower by 10 percent on January. An estimated 800 employees of Yahoo lost their jobs when the company announced that it would implement these economic maneuvers in an effort to save the company.

After rejecting Microsoft’s bid a month ago, Yahoo Inc. through its CEO Jerry Yang explored multiple avenues to increase company outputs such as possible allegiance to giant Google Inc., AOL Time Warner and News Corp. “Yahoo is better off inside a larger company with (a) strong balance sheet and technology, a combination of Yahoo’s relationships (with DSL providers), and Microsoft’s applications and devices, could create a very well positioned potential competitor,” Imran Khan of JP Morgan wrote.

The online advertising market is expected to increase from over $40 billion in 2007 to nearly $80 billion by 2010.

Posted by News LI Editor · Edited by Brianna - Filed Under Technology