In the wake of shattered hopes for an advertising agreement with Google, Yahoo wants Microsoft to rescue it from its financial woes.
Google on Wednesday terminated its agreement with Yahoo following an indication that the Department of Justice would seek to block it. Yahoo was counting on the agreement to accelerate investments in its top business priorities through an infusion of cash.
Now Yahoo CEO Jerry Yang is willing and even eager to resume negotiations to sell his company to Microsoft. Microsoft General Counsel Brad Smith testified against the Google-Yahoo ad deal before Congress on Oct. 1. Microsoft has not yet responded to Yahoo’s off-the-cuff invitation to bid again for the company.
“To this day, I believe the best thing for Microsoft to do is to buy Yahoo,” Yang said Wednesday evening at the Web 2.0 summit in San Francisco. While Yang said Microsoft and Yahoo haven’t been talking since hostile takeover negotiations ceased earlier this year, he and the board “remain open to everything.”
Yahoo’s Hard Stance
Yahoo rejected Microsoft’s $44.6 billion takeover bid — twice. Microsoft CEO Steve Ballmer sent what amounted to an ultimatum letter to Yahoo’s board in early April. The letter made clear that Microsoft’s goal in making “such a generous offer” was to create the basis for a speedy and ultimately friendly transaction.
The deal died, along with all talk of it, until mid-October. That’s when Ballmer said a Yahoo acquisition would still make sense for both companies at the Gartner technology conference in Orlando, Fla.
Ballmer insisted that Microsoft had no interest in acquiring Yahoo and was not holding any discussions with Yahoo. He did say the companies could consider a partnership on search engines in the future. Microsoft also issued a statement at that time saying it had no interest in acquiring Yahoo.
Changing Market Moods
Yahoo’s shares closed…