Microsoft makes $44.6 billion bid for Yahoo!

01 February 2008

Mumbai: The world's largest software company Microsoft Corp. has made an unsolicited bid for Yahoo! Inc., at a share price of $31 per share, making the total offer value  around $44.6 billion.

The offer is at a 62 per cent premium to Yahoo's closing stock price of $19 on 31 January 2008, Microsoft said in a statement.

Yahoo! shareholders have the option of choosing either cash or stock, according to Microsoft.

Yahoo!'s shares have slid 32 per cent this year, and the offer, besides being the largest ever proposed acquisition by Microsoft, has the potential of creating the ''most formidable competitor yet'' for Google, the search engine giant, according to the New York Times.

''This proposal represents a compelling value realization event for your shareholders,'' Steven A. Ballmer, Microsoft's chief executive, said in a letter to Yahoo!'s board sent Thursday.

Microsoft and Yahoo! have been collaborating to find ways of working together since some years now, specially 2006 – 2007, though Yahoo! had ruled out earlier proposals for merging with Microsoft.