With advice from Goldman Sachs, Lehman Brothers and Moelis & Company, Yahoo has confirmed the rumors and officially rejected Microsoft’s proposal. Now, it’s back to Microsoft to counter, or escalate the possible takeover.
In a letter to Yahoo staff, which is reprinted below, CEO Jerry Yang explained their logic.
Just as the writer’s strike seems poised to end, another complex negotiation may be about to get even more intense. The Wall Street Journal is reporting Yahoo’s Board of Directors is set to reject Microsoft’s $44.6b takeover offer as soon as Monday.
According to the report which cites a “person familiar with the situation” as its source: Yahoo’s board has concluded from initial discussions that Microsoft’s $31 per share offer “massively undervalues” the company. They believe the offer is an opportunistic effort to take advantage of recent weakness in the stock market, and Yahoo’s stock price in particular.
In what may be a negotiating ploy aimed at raising the price, the Journal’s source notes that the company is unlikely to consider any offer below $40 a share. That would raise the deal value by more than $12b to more $56b.
If the report proves accurate, Yahoo’s decision will put Microsoft to a difficult decision. Click to Read More
YouTube long ago won the popularity contest for user generated video. Other startups, even some of the same founding generation, have been battling for second place or to just survive. Some like Grouper, reinvented themselves. Now, Los Angeles based Revver, one of the earlier competitors, appears poised to bow out of the race entirely.
Citing “sources familiar” CNET’s News.com is reporting that the company is in dire need of cash and may be sold for as little as $300 to $500k plus the assumption of an estimated million dollar debt. A price in that range would represent pennies on the dollar relative to total investment in the company.
Sometimes rumors sound crazy. Sometimes they’re so crazy, they end up becoming true. Microsoft proved that early this morning with the surprise announcement of an unsolicited cash and stock takeover offer for struggling web giant, Yahoo.
Rumored at times to be possible, probably, and impossible, one thing a deal between the two never seemed was real. For more than eighteen months of chatter, partnership talk and innuendo, this prospect seemed like somebody’s fantasy. Now it is shockingly real.
Microsoft has offered to pay $31 a share, which represents a purchase price of approximately $44.6 billion. The proposal would provide for cash and stock payment. Yahoo! shareholders will be able to choose either cash or stock, with the total deal being half of each. The offer represents a 62 percent premium above the closing price of Yahoo! stock on Jan. 31, 2008.
Amazon was a pioneer in establishing internet based e-commerce. Now, in their second act, they look like they are trying to blaze a similar trail in the sale of digital goods. Today, in line with those efforts, Amazon announced they will buy spoken word (audiobook) publisher Audible for $11.50 a share in cash.
At the $11.50 a share price Amazon is paying a 24% premium over Audible’s Wednesday closing price of $9.33 a share. Two months ago Audible traded upwards of $14 a share. Last quarter they did sales of $27m and lost $192k. Those metrics may make the purchase look like a bargain (and it probably is), but views on that are likely to be divergent. Part of the reason: last month, Audible’s largest shareholder, Apax, signaled a lack of confidence in the company when they (and affiliates) began selling off their 23% stake in the company.
Probably the best near term gauge for valuing this deal as an Amazon shareholder lies in measuring the strategy it reflects rather than the approximately $300m purchase price.
With acquisitions and a good sense of timing Getty Images grew from a small photo licensing business in 1995 to the world’s largest supplier of stock photos and videos. Monday, the company confirmed it is now for sale in an auction to close at the end of the month. Fueled initially by the digital world’s growing appetite for images, Getty Images has become a casualty of the same technological advancements and efficiencies that fueled its growth.
When Getty started out, it was the early days of the Internet boom. Click to Read More
With the widespread news of