Microsoft Withdraws Offer for Yahoo; Yahoo's Shares Fall 21%

Authored by Ned Sherman on May 5, 2008 - 3:36am.

New York - On Saturday, Microsoft withdrew its bid to buy Yahoo after Yahoo turned down its offer to increase its price by $5 billion to $47.5 billion.

Microsoft released a letter from its CEO Steve Ballmer to Yahoo's CEO Jerry Yang ending the talks. "I am disappointed that Yahoo! has not moved towards accepting our offer...after giving this week's conversations further thought, it is clear to me that it is not sensible for Microsoft to take our offer directly to your shareholders. This approach would necessarily involve a protracted proxy contest and eventually an exchange offer. Our discussions with you have led us to conclude that, in the interim, you would take steps that would make Yahoo! undesirable as an acquisition for Microsoft."

Yahoo's shares fell 21% in pre-market trading Monday.

http://www.reuters.com/article/technologyNews/idUSN0432754420080504 http://www.reuters.com/article/marketsNews/idUSN0536341720080505



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