For Microsoft, the waiting game may soon be offer as it finally gave a deadline for Yahoo to accept its $41 billion offer. Microsoft warned that if Yahoo does not accept the offer by April 26, Microsoft will resort to hostile takeover at even a lower price than $41 billion.
In a letter addressed to the Yahoo board last Saturday, Microsoft‘s Steve Balmer wrote:
“If we have not concluded an agreement within the next three weeks, we will be compelled to take our case directly to your shareholders, including the initiation of a proxy contest to elect an alternative slate of directors for the Yahoo board.”
Citing Yahoo’s declining search share and page views, Balmer also said that:
“If we are forced to take an offer directly to your shareholders, that action will have an undesirable impact on the value of your company from our perspective which will be reflected in the terms of our proposal.”
Balmer also believed that majority of Yahoo’s shareholders share the same assessment as Microsoft with regards to the declining value of Yahoo, and that its proposal is the only option for Yahoo to give its shareholder full and fair value for their share. Balmer even acknowledged Yahoo’s efforts to find alternatives that would counter Microsoft’s bid but to no avail.
As Yahoo buys some more time before the annual shareholders meeting is held, Microsoft in the meantime is reported to have hired a solicitation firm that would prepare the hostile takeover. As to when the hostile takeover will happen after the deadline, only Microsoft knows. Knowing the turn of events that has been happening, this might happen sooner than we can think.