Yahoo Lays Off and Microsoft Lays On
As BoomTown noted last week, Yahoo will roll out its previously announced layoffs today, according to a report in The Wall Street Journal.
The Journal is saying the number of layoffs will be 1,000 out of 14,300 employed at the troubled Internet company. But sources told BoomTown that figure might be higher.
There’s no question that if Microsoft wins its effort to buy Yahoo–yesterday, it rejected Yahoo’s rejection of its unsolicited offer to acquire Yahoo for $31 a share–even more jobs will be lost as it consolidates the pair’s many overlapping properties.
And it is clear Microsoft is not going away without a fight. “The Yahoo! response does not change our belief in the strategic and financial merits of our proposal,” noted Microsoft officials in a statement yesterday. “As we have said previously, Microsoft reserves the right to pursue all necessary steps to ensure that Yahoo!’s shareholders are provided with the opportunity to realize the value inherent in our proposal.”
In fact, according to sources familiar with Microsoft’s thinking, execs there think the price they offered is fully baked. “Maybe there will be a face-saving sweetener, but it is a fair price considering all the work that has to be done there,” said one source, who made it sound like Yahoo was kind of like a dot-com fixer-upper in need of a little paint and a lot of TLC.
Until it wins Yahoo, Microsoft is more apt to be doling out something more akin to tough love. The company also noted in its statement: “Based on conversations with stakeholders of both companies, we are confident that moving forward promptly to consummate a transaction is in the best interests of all parties.”
That means, I think, that Microsoft is not attacking quite yet, but also not going away, and definitely not giving up.
The fight now appears to be moving to the joint shareholders of both companies. Next stop: Capital Research’s Gordon Crawford (who, by the way, is a very savvy investor who was once deeply caught up in the AOL/Time Warner fracas, so he knows from fracas).
In other words, particularly the immortal ones of Bette Davis’s Margo Channing: Fasten your seatbelts, it’s going to be a bumpy night.