Microsoft has bid $44.6bn (£23bn) for Yahoo, the second-biggest online property behind only Google. The $31-per-share cash-and-stock bid, made after markets closed, is a 61% premium to Yahoo's closing stock price.
The stock graph comparison for the past year with Google tells its own story: Yahoo stock down 40%, Google's pretty much steady despite all the turbulence in the markets and disappointing results last night from the dominant search engine.
If Microsoft succeeds in the bid (which will almost certainly be referred to competition regulators, since it would give Microsoft a huge share of many online markets), it could propel it into pole position online and ready it for the world that its new software architect, Ray Ozzie, anticipates: one where Microsoft has to deliver services to a population online, not statically on desktops running Windows.
Microsoft was reported (in the NY Post) to have approached Yahoo last spring, but that was quickly denied; Yahoo said it wasn't interested.
Since then Terry Semel has left, co-founder Jerry Yang has taken over, and Yahoo has continued (for the 8th quarter in a row) to disappoint Wall Street with its results while promising that better times lay ahead; Yang suggested that would be in 2009. Meanwhile, it laid plans to cut 1,000 staff.
Jack adds: Microsoft has now posted a press release that includes "the text of the letter that Microsoft sent to Yahoo!'s Board of Directors" yesterday.
