Microsoft Chief Executive Steve Ballmer said his company increased its offer to $33 per share, from the $31 per share cash-and-stock bid that it initially made on January 31. But Yahoo was looking for $37 a share, Ballmer said.
“Despite our best efforts, including raising our bid by roughly $5 billion, Yahoo has not moved toward accepting our offer,” Ballmer said in a statement.
“After careful consideration, we believe the economics demanded by Yahoo do not make sense for us, and it is in the best interests of Microsoft stockholders, employees and other stakeholders to withdraw our proposal,” said Ballmer.
Yahoo was not immediately available for comment.
Laura Martin, a senior analyst at Soleil Securities, said Yahoo was demanding too high a price and she expected its shares to fall $8 on Monday when trading resumes on the Nasdaq. The shares closed up nearly 7 percent at $28.67 on Friday on hopes of an agreement between Microsoft and Yahoo.
“The Yahoo guys want too much money for their company. We think $33 a share is fair in the context of the weakening economic environment and adverse advertising trends,” Martin said, who has a “hold” rating on Yahoo shares.
I continue to be embarrassed by the leadership at Yahoo. Read it all.