Microsoft, it seems, is hell-bent on taking control of Yahoo, and isn’t about to let a little thing like Yahoo rejecting their unsolicited $31 per share bid get them down. According to a report published Tuesday in The New York Times, Microsoft is about to launch a battle to take control of Yahoo’s board this week.
Microsoft will nominate a slate of directors to Yahoo’s board, in an attempt to pressure Yahoo directors to negotiate with Microsoft. This method – known as a proxy fight – is actually viewed as a less costly way to buy the company.
Microsoft offered $31 per share, a deal which was initially worth $44.6 billion. Yahoo is reportedly holding out for $40 per share, and thought that Microsoft’s bid seriously undervalued the company.
Perhaps in a warning to Yahoo, Microsoft Chairman Bill Gates told the AP on Monday that Yahoo’s board “should take a hard look” at their original offer. According to those in the investment community, in such a proxy battle, insitutional investors would back Microsoft.