Microsoft Eyes At Yahoo

Mathematical theories may prove that one plus one is two, but in the business world one plus one is not two but a bigger one. If the number one software company Microsoft and the number one internet business company Yahoo merge together, it will be then. for sure, not two companies leading on different fields of business but a single company reigning over the software and internet business globally. This is not a mere speculation, but a nearest future possibility as software giant Microsoft has already expressed their wish to acquire Yahoo, of course, for a huge price tag.

Microsoft has made an official proposal to acquire Yahoo in a deal worth $44.6 billion in cash and stock, at a price of $31 per share, which represents a 62 percent premium for shareholders. Microsoft"s proposal would allow the Yahoo shareholders to elect to receive cash or a fixed number of shares of Microsoft common stock, with the total consideration payable to Yahoo shareholders consisting of one-half cash and one-half Microsoft common stock.

Releasing the press note Microsoft"s CEO, Steve Ballmer said “We have great respect for Yahoo!, and together we can offer an increasingly exciting set of solutions for consumers, publishers and advertisers while becoming better positioned to compete in the online services market. We believe search advertising market our combination will deliver superior value to our respective shareholders and better choice and innovation to our customers and industry partners." Microsoft said it had identified four areas that would generate at least $1 billion in annual synergies for the combined entity.

Yahoo commented to the proposal that “Yahoo! Inc, a leading global Internet company, today said that it has received an unsolicited proposal from Microsoft to acquire the Company. The Company said that its Board of Directors will evaluate this proposal carefully and promptly in the context of Yahoo's strategic plans and pursue the best course of action to maximize long-term value for shareholders."

If the deal is done it will be the mega deal of this century which is potential enough to overturn the fate and future of software and internet business. If Microsoft and Yahoo come to an agreement, the two firms are estimated to have a 27% stake in the quickly growing search advertising market, compared to the 65% of Google.