03:10 AM

Newswatch 2.1.08: MSFT goes hostile on YHOO

Why MSFT went public

[AllThingsDigital] Sources at Yahoo tell me that Microsoft made its most recent overtures right after Yahoo announced its earnings Tuesday and then told Yahoo execs they had two days to respond or Microsoft would go public with the offer. When Yahoo balked at the heavy-handed tactic, guess what? Microsoft went public. Now Yahoo is scrambling to figure out a response to the overture, but is looking for any other option but Microsoft.

Microsoft-Yahoo bid: Behind the scenes

[Seattle PI] The announcement follows months of rumors, and for Yahoo, it comes amid a sinking share price and layoff plans. Significantly, it's being made not as an agreement with Yahoo but as a proposal to its board of directors -- from which Yahoo's chairman and former chief executive, Terry Semel, resigned last night, just prior to Microsoft's announcement.

Ballmer letter to Yahoo

[Microsoft] In February 2007, I received a letter from your Chairman indicating the view of the Yahoo! Board that “now is not the right time from the perspective of our shareholders to enter into discussions regarding an acquisition transaction.” According to that letter, the principal reason for this view was the Yahoo! Board’s confidence in the “potential upside” if management successfully executed on a reformulated strategy based on certain operational initiatives, such as Project Panama, and a significant organizational realignment. A year has gone by, and the competitive situation has not improved.

YHOO statement

[Yahoo] Yahoo! Inc. (Nasdaq:YHOO), a leading global Internet company, today said that it has received an unsolicited proposal from Microsoft to acquire the Company. The Company said that its Board of Directors will evaluate this proposal carefully and promptly in the context of Yahoo!'s strategic plans and pursue the best course of action to maximize long-term value for shareholders.

The impact on web workers

[WebWorkerDaily] I see three major benefits to web workers if this deal goes through: Google gets some real competition, Microsoft gets a big dose of Open Source culture and flickr and del.icio.us get some innovation.