Feb 1, 2008 : Microsoft Makes $44.6b Bid on Yahoo

📅 February 1, 2008 - Microsoft (microsoft.com) announced on Friday that it has made an unsolicited offer to buy Yahoo (yahoo.com) for $44.6 billion in cash and stock, a bid that would mark the biggest Internet deal since the Time Warner-AOL merger and that experts believe could equip both companies to take on search engine giant Google.


In what could be marked as its boldest acquisition move to date, Microsoft offered $31 per share for Yahoo, or a 62 percent premium over the Internet media company's closing stock price on NASDAQ Thursday. Yahoo, whose shares jumped to $30.75 in pre-market trading, said it would evaluate the bid while Microsoft shares, which have a market capitalization of about $300 billion, fell six percent to $30.78.

According to reports, Steve Ballmer, Microsoft's CEO, says that after 18 months of talks with Yahoo, this bid marks "the next major milestone" for Microsoft and that he is very confident that this is the right path for both Yahoo and the software giant.

Speculation over a Microsoft move on Yahoo has swirled for at least a year, as investors wondered whether the two would seek a joint stand against an ever more powerful Google. It has been estimated by Internet audience researcher comScore that Google's share of the worldwide Web search market has reached 77 percent, while Yahoo is second with 16 percent and Microsoft was a distant third with 3.7 percent.