Yahoo! and Microsoft terminate talks, this time for good Yahoo! has terminated all acquisition talks with Microsoft, today saying Microsoft was only interested in the internet provider's search business. Yahoo! shares fell 10 per cent today to $23.52, from yesterday's closing price of $26.52. The beleaguered company is hitching its fortunes to the Google juggernaut with a search, …
The anti-trust regulators would never approve a merge of their search businesses. But if it somehow was possible, Yahoo without its search business would collapse.
Icahn will undoutedly now use this as the basis for his espionage to Yahoo, Yahoo's owners are correct in their thinking any such deal would not be in the best interest of those wishing to keep Yahoo shares or if they even slightly care for the company.
But given the rapid drop in share price, i cant help but feel this will give Microsoft...sorry Icahn his success, and at which point all parties involved there will only be losers, no winners. Why can't Icahn be held responsible for his actions too??
iCahn strikes as 'that guy' from Futurama...
"At one time I was the toast of wall street [snip] But then I was diagnosed with terminal Bone-itis. There was no cure. One company was close to a cure - but I arranged a hostile takeover, and sold off all the assets - made a cool £100m. *coughs painfully*"
Quite literally someone who would sell off their grandmother to make a few quid...
Am I alone in thinking this?
Steven R
The only valuable part of Yahoo! is the portal/mail tie-in it has with mega-ISPs like at&t. Rebranding Yahoo! search as Microsoft doesn't solve the underlying issue: people use Google even if the default search engine on 90% of the browsers on earth point to Microsoft.
Ol' Carl's got some tricks in his back pocket - like a proxy fight coupled with some naked shorting of Yahoo! to allow him to apply even more pressure. Once he wins (and he WILL win), he'll sell the whole shooting match to Microsoft for $30-$35 a share - still better than what the stockholders can get today or tomorrow, especially if Yahoo! "outsources" their search to Google. (Then what "search" does Yahoo! have left?)
We'll see what happens leading up to the shareholder's meeting...
> Why can't Icahn be held responsible for his actions too??
Well, you seem not to understand much about capitalism.
The board can be held responsible because it does not own Yahoo, merely manage it for its legal owner.
Icahn cannot be held responsible for his action because HE IS the owner (well, partly) so he can do whatever he wants with his shares.
In the same way that if you destroy your house (no insurance claiming) because you don't like it anymore, you can't be held responsible, the very sentence is meaningless in that case. But if you appoint someone to manage your estate and that person destroys it, then they will of course be held responsible for it.
Simple no?
And this is regardless of whether Icahn is actually morally justified in doing that, or whether it is actually the right thing even for him: it does! not! matter!
People can moan all they like, but the only company out there with the power to at least challenge Google are Microsoft.
A Yahoo! purchase by Microsoft would have at least given Google some decent competition. Now Yahoo! are getting in Googles pocket, which from an external point of view is seriously anti-competitive.
Microsoft may be evil, but when a market needs competition, they are very good at giving it. Look at the console market, this generation is fantastic for gamers, because of the competition between PS3 and 360.
"Good riddence, MS has no winning Internet element Yahoo needs and if they won't pay big cash, Yahoo shareholders can do better."
Really? $23 today. On the table was $33 and now it appears back in 2007 $40 was on the table. Look pretty much like the Yahoo! board missed the boat and are guilty of serious misjudgement to me in maximising the value for their shareholders.
Now I might wonder what on earth Microsoft's board is doing letting them make such outrageously high bids for Yahoo! but that is a completely different matter. Yahoo! shareholders would have been much better off taking the $40 offer and getting the hell out while a misguided merger crashed and burned. As it is it looks to me like Yahoo! will suffer a long slow painful decline before eventually being aquired for way less than these figures. As for Microsoft - a slow mamouth that is probably better of without the distraction of trying to integrate Yahoo!
"This partnership would ensure healthy competition in the marketplace, providing greater choice and innovation for advertisers, publishers and consumers,"
Indeed, reducing the marketplace from primarily three to just two companies competing would oh so help competition in the marketplace and deliver much more choice.. or not.
The board has clearly shirked its responsibility to the shareholders, and Icahn will have his day. Whatever the motivation they have bungled this one like school boys. I would be pissed to watch my investments sublimate from serious money at 30 to smoking descent towards sub-20, because they refused a takeover and then threatened to burn the fields and poison the well.
From what I know about Yahoo! inside, this was the last thing Microsoft needed. Acquire an expensive, reserve-depleting albatross with serious internal problems of its own, and then try to integrate it. No thank-you.
Run, don't walk, away from this one Microsoft. Perhaps the idiots did you all a favor. And hold onto that money for right now.
Who really cares? Let this thing go. Yahoo! doesn't have the best search engine, portal, mail service... well, anything. Since they are keeping the same staff on board, I don't see this changing in the near future.
I wouldn't purchase their stock, advertise on their services or use their e-mail service. Everyday, more and more people are learning there are better services elsewhere without bogging down your browser with 25 adds a page.
Let Yahoo! go up in flames do to ignorance and a misplace feeling of superiority.
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