Yahoo isn’t against being taken over by Microsoft if the price is right. Microsoft has little enthusiasm for doing so, but doesn’t want its acquisition effort to take several more months.
The back and forth between Yahoo and Microsoft ever since an intention to acquire Yahoo became public in January resembles the Death Start trench scene, where Rebel fighters bounce back and forth trying to avoid Darth Vader blasting them into smoldering bits.
Put Jerry Yang in Gold Leader’s seat, hand the Vader helmet to Steve Ballmer, and you get the idea. Unlike the movie, no one wants to play the Han Solo role and save the Rebels.
Yang and company tried a few tactics to save themselves. They managed to push back their annual meeting to possibly as far out as October of this year, and made themselves more expensive to acquire by gifting staff with massive bonuses should they choose to leave an acquired Yahoo for any reason.
Microsoft addressed the latter today, as the software company dedicated $1.5 billion to keeping Yahoos from hitting the eject button in the face of a Microsoft takeover. The question of the annual meeting requires resolution.
That could be happening sooner than later. The question comes back to money, as the Wall Street Journal noted a meeting taking place between the two companies today.
“Microsoft has said privately in recent days that it’s willing to offer as much as $32 or $33 a share, well above the $29.12-a-share value of its original cash-and-stock offer as of Tuesday’s market close, these people say,” the Journal said.
“But major Yahoo shareholders have signaled they want in the range of $35 to $37 a share, with Yahoo’s management and board similarly shooting for an offer in the upper $30s, they add.”
In other words, the two sides are billions of dollars apart. No legitimate bidder for Yahoo emerged over the past couple of months, and Microsoft faced the prospect of bidding against itself. Ballmer and company certainly disliked that idea, their bid being the impetus for pushing Yahoo’s stock up to its current value, closing at $27.41 today.
Perhaps given the ranges of numbers mentioned by the Journal, the two sides could compromise at $34 per share. Neither side would be entirely happy with that price, but if Microsoft really thinks the market for online advertising will legitimize its first bid over time, a higher bid may prove itself in the future too.
