Yahoo, Microsoft game of chicken continues

ballmerwait2.jpgDeal brinksmanship or genuine threat? You be the judge.

The Wall Street Journal and Reuters reported on Tuesday that Microsoft has no intention of raising its bid to buy Yahoo beyond its initial offer of $31 per share in late January. And why would they, given that no credible counter offer has materialized.

Despite Yahoo co-founder Jerry Yang’s best efforts to court News Corp and AOL, and a road show with investors to talk up Yahoo’s future, most believe the deal remains Microsoft’s to lose.

Who are the winners in this long drawn out fight? Neither, Silicon Alley Insider’s Henry Blodget suggests. In this industry, the longer you wait, the further you trail.
(Reuters) (WSJ)

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Yahoo: Here’s why we rejected Microsoft offer

yang2.jpgYahoo’s surprise three-year forecast announcement on Tuesday lays out why the Internet giant has refused to budge from its belief that Microsoft’s bid severely undervalues the company.

The Sunnyvale, Calif. company believes it can nearly double its operating cash flow to $3.7 billion and boost revenue, excluding payments to affiliates, to $8.8 billion. Built into the forecast is an expectation of $1.9 billion of additional revenue over three years in display video advertising revenue, outpacing market growth rates, Yahoo said.

It also reaffirmed previously issued first quarter and full year 2008 forecasts.

Wall St Poll-Microsoft nabs Yahoo, but at what price?

yahoo_hq_yahoo_car_kimberly_white_reuters_cropped.jpgThe latest data from a Reuters poll of Wall Street analysts who track either Microsoft Corp or Yahoo Inc, shows 28 of 30 analysts expect Microsoft to prevail in its unsolicited bid to acquire Yahoo, which is currently valued at $41.7 billion.

Fourteen analysts expect Microsoft to stand by its initial offer price of $31 per share in an equal mix of cash and stock. Four analysts expect Microsoft to keep offer at $31 per share but make all-cash offer, effectively raising the deal’s value.

Twelve analysts expect Microsoft to raise price to between $31.50 and $35 per share.