Microsoft Would Restart Yahoo Talks With New Board
July 7, 2008
Reuters is reporting that Microsoft Corporation would be open to a new plan to buy all or part of Yahoo if a new Yahoo board is elected.
Microsoft, which broke off talks in early May to buy the Internet company for $47.5 billion, said it would resume discussions immediately if a new board were elected at Yahoo's August 1 stockholder meeting.
The Microsoft statement came after Icahn, the billionaire financier who holds over 4 percent of Yahoo, issued his own statement that he had "spoken frequently" to Microsoft CEO Steve Ballmer over the last week. Previously, the two had not spoken.
Ballmer told Icahn that a big impediment to any Yahoo deal was his concern that the current board could "mismanage" the company while the deal awaits regulatory approval, a process that could take nine months or more, according to Icahn.
In an interview, Icahn argued that his proposed dissident board slate would make Microsoft feel more secure in risking a large sum of capital to complete the deal during the regulatory approval process.
Microsoft's openess to talks came after Carl Icahn's letter to shareholders that said a new board would "Immediately start negotiation with Microsoft to sell the whole company or, in the alternative, sell 'Search' with large guarantees." Speculation about Microsoft and Yahoo has been going on for months with Yahoo's stock price rising and falling along the way. Yahoo has also been losing a number of its employees.
Meanwhile, another story in the Times Online says Yahoo has entered merger talks with Time Warner. Something is going to happen to Yahoo but it is still unclear exactly who that will be and when it will occur.
