Microsoft's Not Bluffing
Look, it might be the biggest poker bluff in history and analysts are once again chattering that Yahoo’s (YHOO) ad-outsourcing deal with Google (GOOG) might force Microsoft (MSFT) back to make another offer for the Internet portal.
Sorry to be the skunk at Carl Icahn’s garden party, but BoomTown doesn’t think so.
Consider this from my post earlier today, from a source close to Microsoft’s thinking:
Microsoft sources say execs were stymied by Yahoo, which offered to sell the entire company to Microsoft up until three days ago.
But, as Yahoo has even said, Microsoft remained steadfast in its lack of interest in a bigger deal, after it walked away a month ago from its botched takeover attempt.
And it is still not interested, even with the pressure a Yahoo-Google partnership now presents.
“Yahoo might still dream of a big deal and hope they can win this game of chicken by doing this deal with Google,” said one person familiar with Microsoft’s thinking, about the possibility of Microsoft now making another offer. “But the big deal is done.”
Even if Yahoo’s stock declines even more precipitously? “It’s no longer a price issue with Microsoft,” said the source. “The company has moved on.”
So I queried a bunch of other Microsoft execs close to the dealmaking.
What if Icahn, the billionaire activist investor who is engaged in a proxy battle with Yahoo, somehow manages to get control of the company at its August board meeting?
What if Yahoo CEO Jerry Yang is replaced and a new leader is more amenable to Microsoft?
And, most of all, what if Yahoo shares sink to below $20 again and even lower?
Goodness, even I’d try to acquire Yahoo for under $20 a share, given all its amazing assets and huge traffic.
But, as far as I can tell, Microsoft seems sincere in its walk-away-Renee act for a lot of reasons.
The regulatory window has closed. The deal is tarnished. Microsoft Chairman Bill Gates has never been a fan, and other execs are not either.
And most of all: Yahoos don’t want to be a satellite of Microsoft.
In fact, Rosie O’Donnell and Donald Trump get along better than this tech pair.
And for weekend fun, here’s a picture of that mismatched pair brought together via Disortrait: