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Suddenly Jerry Yang needs Microsoft

HappyAndyK   on 26 June 2008 - 21:59 · 45 comments & 19225 views

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If you haven't been following the latest on the Yahoo front, the company's stock price has plummeted (it's at $21.61 right now, way down from its $29 share price back in February); executives are getting out of town as quickly as possible as a reorganization gets underway; Carl Icahn is exerting unbelievable pressure on Yang; and shareholder confidence in Yahoo is dropping by the minute.

In order to save Yahoo and maybe walk away with some cash himself, Yang has no other choice but to strike a deal with Microsoft and walk away from this albatross.

To make matters worse, Microsoft will never offer $33 per share like it once did. And why would it? Yahoo needs Microsoft more than Microsoft needs Yahoo, and with a stock price that can't even hit $22, why should we expect an offer that's much higher.

Link: CNet

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(2 replies) #1 Ruiz on 26 Jun 2008 - 22:03
They deserve it. Should've made the right decision at the right time
#1.1 Skwerl on 27 Jun 2008 - 14:14
Yes, you are probably correct, but it was a business deal, and they were probably trying to get mnore money out of Microsoft, or perhaps they just didn't want to sell to Microsoft purely out of principle (unless the price was astronomically high). If it's the latter, you have to respect Jerry Yang for at least trying to stick to his guns. I know that, for instance, if Wal-Mart tried to buy my company, I think I'd vomit roaches and sh*t mice before selling anything to those scumbags.
#1.2 mikeyj on 28 Jun 2008 - 00:50
I couldn't agree with you more and if Jerry Yang was any wiser he should of consider the implications of lower stock values as Yahoo remained in limbo without a solid financial footing.
#2 Hidr0 on 26 Jun 2008 - 22:13
MS: make them suffer!
#3 +Somnus on 26 Jun 2008 - 22:14
I seriously wouldn't offer more than $23/share at this point if I was MS.

Why offer a premium price on a company that is in serious trouble, and the World knows it. Hell they know it.

Sure MS can do a lot with Yahoo and their products, but over paying at this point doesn't make any sense. There is blood in the water, and the big green/blue/yellow/orange shark is circling for the kill. And they should make a killing off this deal.

What was a very generous offer at $33/share, and was basically laughed at by Yahoo should be cut by a third and offered again. If they reject it, walk away completely and wait until you can buy it for next to nothing.

In the normal and sane real world, Yahoo would have and should have taken MS' first offer. It was equitable and fair.

All the Yahoo shareholders that previously screamed YAHOOOOOO! have recently winced YAHOOOO - ooo - ooo as their money keeps getting flushed.
(2 replies) #4 virtorio on 26 Jun 2008 - 22:14
Didn't Yang see this coming? Everyone else did.
#4.1 GP007 on 26 Jun 2008 - 22:24
He was probably hoping for someone else to come in and offer to buy them. But no one wanted to start any sorta bidding war with MS, that and no one else gives a care for Yahoo.

Even now, MS just wants a few select pieces of Yahoo, not really the whole thing. IF they do get it finally I see them getting rid of/selling lots of the parts they don't want/need.
#4.2 excalpius on 27 Jun 2008 - 06:32
They were probably hoping for Google to come in. But Google is #1 in search...by a mile. There is no value in Yahoo for Google whatsoever. Just bragging rights.
(6 replies) #5 tsupersonic on 26 Jun 2008 - 22:18
Oh for the love of God, please do not let this merger happen. It's going to be a horrible thing.
#5.1 GP007 on 26 Jun 2008 - 22:22
Why? Please give us some examples as to why you think it'd be a horrible thing. If it's just out of MS hate or something, that doesn't quite cut it.
#5.2 C_Guy on 26 Jun 2008 - 22:26
It helps to read the article before posting pointless Microsoft hate.

Clearly Yahoo is suffering now that Microsoft has pulled out. Therefore, Microsoft's walking away is a horrible thing, not the other way around.

Better luck next comment
#5.3 tsupersonic on 27 Jun 2008 - 12:55
(C_Guy said @ #5.2)
It helps to read the article before posting pointless Microsoft hate.

Clearly Yahoo is suffering now that Microsoft has pulled out. Therefore, Microsoft's walking away is a horrible thing, not the other way around.

Better luck next comment
Me, hate MS? Actually, I like them.

Anyways, that's beside the point. The merger, if it were to happen, would be a terrible thing. Why, you ask? Google is the leader of the search engine. Yahoo is in second place, followed by MSN, etc. If the merger goes through, the business goes to Google, because neither companies get Search like Google. Yahoo needs to be Yahoo, not Microhoo. What Yahoo needs to do is rediscover their image. They need to discover what kind of company they are. Yahoo has so many products all over the place. There is a lack of leadership in the company.

I would just go listen to Twit 148 where Dvorak is right on about this topic. Like Dvorak says, "Let Yahoo be Yahoo."
#5.4 Swordnyx on 27 Jun 2008 - 22:17
(tsupersonic said @ #5.3)
(C_Guy said @ #5.2)
It helps to read the article before posting pointless Microsoft hate.

Clearly Yahoo is suffering now that Microsoft has pulled out. Therefore, Microsoft's walking away is a horrible thing, not the other way around.

Better luck next comment
Me, hate MS? Actually, I like them.

Anyways, that's beside the point. The merger, if it were to happen, would be a terrible thing. Why, you ask? Google is the leader of the search engine. Yahoo is in second place, followed by MSN, etc. If the merger goes through, the business goes to Google, because neither companies get Search like Google. Yahoo needs to be Yahoo, not Microhoo. What Yahoo needs to do is rediscover their image. They need to discover what kind of company they are. Yahoo has so many products all over the place. There is a lack of leadership in the company.

I would just go listen to Twit 148 where Dvorak is right on about this topic. Like Dvorak says, "Let Yahoo be Yahoo."


Well. That made little to no sense. I'd give you many reasons for this, but it's quite clear by reading just the above comments.
#5.5 Ledgem on 28 Jun 2008 - 01:15
(C_Guy said @ #5.2)
It helps to read the article before posting pointless Microsoft hate.

Clearly Yahoo is suffering now that Microsoft has pulled out. Therefore, Microsoft's walking away is a horrible thing, not the other way around.

Better luck next comment

Are you a fanboy, by any chance? Microsoft's creation of an offer to Yahoo, and subsequently withdrawing it, has hurt Yahoo tremendously. It's brought Yahoo's instabilities to light and has created infighting among their board of directors. It's the perfect opportunity for a hostile takeover.

It's not a conspiracy theory because that's a gamble that some business make. Whether that was truly Microsoft's intent or not remains to be seen. Nobody - not I, you, nor any other readers on this site - can say what's going to happen. If Microsoft turns around tomorrow and buys up Yahoo at their current share price it won't make me right, but I'd be inclined to say "I told you so" and perhaps include a "better luck next comment" message, too.
#5.6 Eis on 02 Jul 2008 - 02:03
(tsupersonic said @ #5.3)
(C_Guy said @ #5.2)
It helps to read the article before posting pointless Microsoft hate.

Clearly Yahoo is suffering now that Microsoft has pulled out. Therefore, Microsoft's walking away is a horrible thing, not the other way around.

Better luck next comment
Me, hate MS? Actually, I like them.

Anyways, that's beside the point. The merger, if it were to happen, would be a terrible thing. Why, you ask? Google is the leader of the search engine. Yahoo is in second place, followed by MSN, etc. If the merger goes through, the business goes to Google, because neither companies get Search like Google. Yahoo needs to be Yahoo, not Microhoo. What Yahoo needs to do is rediscover their image. They need to discover what kind of company they are. Yahoo has so many products all over the place. There is a lack of leadership in the company.

I would just go listen to Twit 148 where Dvorak is right on about this topic. Like Dvorak says, "Let Yahoo be Yahoo."


...Still waiting for you to tell us why it's bad.
(5 replies) #6 hagjohn on 26 Jun 2008 - 22:23
I believe Yahoo was around $22 /share before MS purchase offer, so not much of a "dive". Yahoo is still a good company that makes a pretty good profit. Yahoo on the other side does have a lot of work to get their ducks in order.
#6.1 GP007 on 26 Jun 2008 - 22:26
It finally made some money last quarter after about a year or so in the red. The signs though are that it's not going to get much better than it is right now. When you see top executives packing up and leaving, then you know the ship is sinking, albeit slowly.
#6.2 creamhackered on 27 Jun 2008 - 06:32
Of course the stock has dived.

http://finance.yahoo.com/echarts?s=YHOO#ch...ource=undefined

It has been at 28 steady for the last few months but it did dive in early February to 19
#6.3 samriley on 27 Jun 2008 - 10:17
I'd love to know why you believe that they have been in the red, their profit is in the millions (http://finance.google.com/finance?fstype=ii&q=NASDAQ:YHOO). Also not sure why you dont think things will get better either as so far the profit has increased every year.

Stocks go up and down, currently the market in general is down and may well go down further but then it will go back up as it always does. <sarcasm>Google has gone down about $200/share over the last year, perhaps everyone should be screaming for them to sell up too.</sarcasm>
#6.4 GP007 on 27 Jun 2008 - 22:37
(samriley said @ #6.3)
I'd love to know why you believe that they have been in the red, their profit is in the millions (http://finance.google.com/finance?fstype=ii&q=NASDAQ:YHOO). Also not sure why you dont think things will get better either as so far the profit has increased every year.

Stocks go up and down, currently the market in general is down and may well go down further but then it will go back up as it always does. <sarcasm>Google has gone down about $200/share over the last year, perhaps everyone should be screaming for them to sell up too.</sarcasm>


Nice try, but I think you should go back to your link and then click on the "cash flow" chart. Then after you see the negative numbers we can talk again.
#6.5 samriley on 28 Jun 2008 - 08:47
cash flow isnt profit though...
#7 digitalsoft on 26 Jun 2008 - 22:35
I chuckled while reading that! What a huge mistake by Yahoo.
(1 reply) #8 lylesback2 on 26 Jun 2008 - 23:02
I SO CALLED IT!

Back when it was first being debated, I said Microsoft should not counter-offer, and just let Yahoo! drop until Yahoo comes crawling back into Microsofts hands, and will eventually pay less.

Finally.. The take over is happening.
#8.1 toadeater on 26 Jun 2008 - 23:54
(lylesback2 said @ #
I SO CALLED IT!

Back when it was first being debated, I said Microsoft should not counter-offer, and just let Yahoo! drop until Yahoo comes crawling back into Microsofts hands, and will eventually pay less.

Finally.. The take over is happening.


What are you getting out of it? You sound a little too happy about it.
(1 reply) #9 SLiDeR_pt on 26 Jun 2008 - 23:06
MS wont offer anything at all now that Yahoo made a deal with Google, it wouldn't make much sense now, what MS wanted they can't have for years as long as that deal stands, and getting out of it would prove to be costly.

Last edited by SLiDeR_pt on 26 Jun 2008 - 23:25
#9.1 GP007 on 26 Jun 2008 - 23:24
That ad deal hasn't went into effect yet, and it's not even final last I checked. Things like that needs government approval I'm sure.
#10 some_guy on 26 Jun 2008 - 23:16
i wonder why many considered yahoo's rejection of microsoft made microsoft look weak... theres only so much a company is willing to offer before it becomes a rip off. if a company didnt want to be bought by another (in this case) they just say no. microsoft would have made a dumb move if they had bent over to yahoo.
#11 Airlink on 27 Jun 2008 - 01:02
Microsoft and Yahoo deserve each other. It should be fun to watch the implosion.
#12 squashpea on 27 Jun 2008 - 01:44
Well, if competition and diversity create better options for the end-users/consumers like us, then I'm against an acquisition/merger.

Yahoo! has great ideas, but falls short of really making them killer in the amount of time needed to keep most users.
This is what happened to Yahoo! Photos, isn't it? Then they acquired Flickr. And look at how Yahoo! mail started to get so good--but after AGES. They don't understand the game well enough. MS doesn't really understand the "game" either with its EXTREMELY disorganized home page and pointless copycat services.

People who blog prefer to use other platforms because there is more customization and options. Live Spaces/Yahoo 360, Windows Live Mail/Yahoo Mail, Yahoo Video/MSN Video/TV......gosh, it's just failed attempts one after the other. Will they really be able to go in an get this right if they put their forces and heads together? I don't think so.

Some of the best ideas come out of MS and Y!, I believe, but neither have the ability to follow through on it in a meaningful way. At least Google has crazy ideas and some of them do flounder or fall flat, but they find their gem and stick to it and expound upon it (Search, web history, etc.).

Does MS really believe that it can change Y! for the better? Does Y! really believe that money is all they need and they'll miraculously be better? Is it really just lack of money stifling innovation?? Is this just a ploy for more usership? Users will leave you as soon as you don't innovate, IMO.

(2 replies) #13 mocax on 27 Jun 2008 - 01:46
I don't get this business thing.
Are they really doing that badly in business that they need to be bought? (by microsoft or other corporations)
Are investors only interested in buying/selling of companies to get a quick buck?
Aren't founders proud of their companies? Why do they want to sell their "babies"?
#13.1 ricknl on 27 Jun 2008 - 02:25
They have already sold their 'babies' to the shareholders. If they wanted to keep their babies as their babies they could have chosen to keep it as a family business.
#13.2 Swordnyx on 27 Jun 2008 - 22:25
(ricknl said @ #13.1)
They have already sold their 'babies' to the shareholders. If they wanted to keep their babies as their babies they could have chosen to keep it as a family business.

LOL.
(1 reply) #14 +Xerxes on 27 Jun 2008 - 02:26
Personally I hope MS tell Yahoo! to shove it, they deserve it for what they did. However, in reality I'd say MS will move in for the kill and aquire Yahoo! now, it's what they wanted all along.
#14.1 Swordnyx on 28 Jun 2008 - 05:58
That is most likely their plan anyway. I personally think maybe some mastermind at Microsoft cooked up this plan in order to get Yahoo at 1/2 the required offer price.
(8 replies) #15 portauthority on 27 Jun 2008 - 03:45
Microsoft is evil for trying to buy companies
#15.1 NightmarE D on 27 Jun 2008 - 03:57
Most major corporations buy smaller companies. Using your logic all major corporations are evil.
Yahoo
Google
Apple
Among many, many others, have all bought smaller companies. Any idea what you're talking about at all?
#15.2 portauthority on 27 Jun 2008 - 04:10
Not really
#15.3 garyt on 27 Jun 2008 - 04:57
What? I'm not a fan of MS but buying companies is part and parcel of many larger businesses. Maybe you just hate capitalism?
#15.4 kaiwai on 27 Jun 2008 - 08:25
(garyt said @ #15.3)
What? I'm not a fan of MS but buying companies is part and parcel of many larger businesses. Maybe you just hate capitalism?


Portauthority is just ignorant. The reason why Microsoft is purchasing it, isn't because of something superior, they are purchasing it for the Yahoo brand - which is alot more well known than the variety of names Microsofts own internet services has gone through.

Microsoft has the technology, but no brand. Yahoo has a brand, but out of touch when it comes to technology. Atleast under a Yahoo/Microsoft deal, it would not only benefit shareholders, it would also give atleast a degree of job security to the average worker in the trench at Yahoo who has no say in the direction of the company.
#15.5 nunjabusiness on 27 Jun 2008 - 11:29
(portauthority said @ #15)
Microsoft is evil for trying to buy companies


I'm afraid you have everything to learn about how capitalism and fiduciary responsibility works. Maybe you are a young person still in school?

Publicly-traded companies answer to their shareholders who expect the company to continually increase holdings (and profits.)
#15.6 wtfdan on 27 Jun 2008 - 11:36
(portauthority said @ #15)
Microsoft is evil for trying to buy companies


List of acquisitions by Google

Educate yourself. Everybody does it. Microsoft has it's fair share too.

#15.7 thenonhacker on 27 Jun 2008 - 12:46
(portauthority said @ #15)
Microsoft is evil for trying to buy companies


You are just a plain old clueless Microsoft hater. And you probably own a Mac or iPod.
#15.8 ambushed on 28 Jun 2008 - 03:17
Am i the only one that immediately assumed sarcasm in the comment from portauthority?
#16 astrokat on 27 Jun 2008 - 16:36
I am sure Jerry has his reasons, and i am sure they are very good ones. It is probably not in his best interest to sell for MS for whatever the reason is. Unless this guy is an ego maniac or completely clueless, I will give him the benefit of the doubt. I am sure there are details we are unaware of. I am surprised how critical you guys are LOL!! If Yahoo really didn't have a direction, people would be jumping ship and the hostile takeover would have been successful a few months back. Although investors are losing confidence, it sounds like other higher level people support this decision or they would have made it known that they didn't to the public to undermine Mr. Yang.
#17 ANova on 27 Jun 2008 - 18:07
Who cares, **** whining shareholders.

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