Steve Bomb-mer Drops Another One on Yahoo, Whose Shares Tank to $9, as Microsoft Settles on Digital Head Pick
At least Yahoo got one day of stock euphoria, on the news that its CEO, Jerry Yang, was stepping down, before Microsoft CEO Steve Ballmer dropped yet another bomb on the troubled Internet giant by saying once more with feeling that he is not at all interested in buying it.
Yahoo (YHOO) stock plummeted on the news, dropping below $10 a share to close at $9.14, down $2.41 or an astonishing 21 percent.
While lack of interest in acquiring Yahoo is a sentiment that Ballmer has expressed more times than Alaska Gov. Sarah Palin said “maverick” in the presidential campaign, Wall Street continues to hold out hope that Microsoft might swoop in and make a new takeover bid for all of Yahoo.
It will not. Let’s repeat. It. Will. Not.
Thus, an obviously frustrated Ballmer reiterated his nondesire for Yahoo at Microsoft’s annual shareholders meeting, near its Redmond HQ today.
“We are done with all acquisition discussions with Yahoo,” Ballmer said. “We did our best…we’ve moved on.”
And so should investors, stock analysts and hedge fund vultures, who actually contact BoomTown on a daily basis, asking if when I wrote that Microsoft (MSFT) was not interested in buying Yahoo, I actually meant that it was interested.
Not interested means, well, not interested, except when it comes to those who wish fervently for a pop in Yahoo stock.
But the only way that is going to happen is slowly, as Yahoo rebuilds its much-battered business, brick by brick. And that presumably will happen when a new CEO is selected to run Yahoo.
Lucky for Yahoo, what Ballmer has repeatedly also said is that he was very interested in (and said again today) a search partnership deal with the company.
Microsoft essentially wants to take over that part of Yahoo’s business and will likely give it a pretty penny to do so. For all its troubles, Yahoo remains the No. 2 search player, well behind Google (GOOG), but well ahead of Microsoft.
Microsoft execs think grabbing Yahoo’s business will help it gain on Google–good luck with that, but it gets an A for effort!
And it also hopes another reorganization of its digital businesses will help it do so.
Right now, for example, newly annointed digital exec Yusuf Mehdi is deep in the midst of a restructuring of his division.
Mehdi’s online services portfolio at Microsoft now includes marketing, online audience business development and product management for MSN and the search properties, but divisions and execs are being shifted around.
But the big news, of course, will be the person Ballmer selects to be Mehdi’s boss, as well as the boss for Satya Nadella, the SVP who heads engineering for Microsoft’s search, portal and advertising platform group, and for Brian McAndrews, the SVP for the advertiser and publisher solutions group.
While Ballmer has taken his sweet time in picking someone, after Kevin Johnson left his post overseeing the division in late July, sources inside and outside Microsoft have told me the company is very close to picking a new head.
That would be a good thing since Ballmer has worn out his Rolodex trying–he has been turned down by many, including former Yahoo CEO Dan Rosensweig.
While I am trying to ferret out the current choice, sources said the main candidate is more technically oriented and is well known in Silicon Valley.
Please see this disclosure related to me and Google.