Yahoo has every right to reject, and probably should too!
@Jason
I disagree the Boards job is to set and abide by the companies mission statement, which states the goals and objectives of the company, this is what investors are buying into, not necessaryily this quarters profits, but a piece of Captial assests, a piece of a company for life. This ALMOST always includes making a return on investment, but not always. Non-profits have boards and their profit is not their main concern of business. The NAACP does not for example oust its board for not maximizing revenues - there is a service to the community that is supposed to superceed that. Even for profit companies have other missions and goals that drawl investors to put their money behind the companies efforts. I know a lot of Microsoft haters will drop Yahoo's web services like a lead zeppelin if they are bought, and many investors would either sell or not buy their stock or product based on this as well. I count myself as one such person.
Further any board can justify their actions in court as forward looking, the very act of building a brand, even though it may be a long money losing venture - can ultimately result in a profitable company. If the board thinks they can make more money for their investors than M$ can offer then M$ really has no business saying otherwise, unless they like looking like a spoiled rich kid who just can't buy being cool. Yahoo thinks they are the best people to run these assests, the fact that they are doing so well M$ wants to force a purchase sounds to me like a solid financial vote of confidence in the current Yahoo board. People who purchased this stock thought the same as well, if they thought M$ was so great well then gee they could have gone and bought M$ stock instead, but they didn't.
Ditto with AC, please don't start using upcoming blogs as a potential bit of news - unitl the blog is out, and its information confirmed - its not news.
I'm thinking of ending cancer tomorrow, but thats not news until I actually DO IT.