More Videos
- Still No Deal For Yahoo--Period
- Yahoo Stock Plunge Continues--And Continues
- RealNetworks Tries to Get Real with Apple
- The Gates $$$ Legacy (A Look At The Microsoft Money Machine)
- One Small Step for Intel; Giant Leap for Apple?
- Oracle Traders Giveth, Taketh Away
- Oracle Blows Past the Street: Investors Have To Be Lovin' It
- RIM Misses But Will Cooler Heads Prevail On Stock?
- A Word To The Wise On Yahoo Rumors
- Oracle Becomes Macro "Oracle" For Economy
- Bowyer: Back to Monarchy in Land Rights?
- Parking Cash in European Telecoms
- Bargain Stocks: Nokia, Spectra, Incitex Pivot
- Sticker Shock: Fast Money's Inflation Special
- Our Favorite Inflation Trades
- Warren Buffett's Annual Stock Gift to Gates Foundation Worth $1.8B This Year
- That '70's Trade
- The Villain Of Our Story
- The Blame Game
- EU Opens Probe in BHP Billiton Bid for Rio Tinto
- Worse Car Sales Decline Expected in Western Europe
- Euro Banks Need to Raise $90-$140 Billion: Goldman
- BSkyB Mulls $4 Billion Bid for Spain's Digital Plus: FT
- On the Bright Side, Shopping Bargains Abound
- Euro Stocks Fall as Goldman Note Hits Banks
- Return of Asian Currency Crisis Is Unlikely: ADB
- European Shares Set to Open Flat as Holiday Shuts US
- Airbus to Sell Five A380s to Japan's ANA: Nikkei
 |
I hear from a source close to the situation that top execs from both sides met this week in Sunnyvale to continue "informal" talks, but when Microsoft [MSFT
Loading...
()
]refused to raise its offer, Yahoo [YHOO
Loading...
()
] refused to take the talks to the next level. And so here we sit, wondering what happens next.
I hear there's an important meeting at Yahoo coming up this Monday that will include top execs and division leaders. I'm hearing it's an all-hands-at-the-executive-level type of thing. Is this the meeting that Microsoft has been waiting for? Is Yahoo ready to throw in the towel and it's holding this meeting to notify managers that a deal is imminent?
Or, is it instead going to be a rah-rah gathering reiterating Yahoo's intention not to buckle under the 62 percent premium Microsoft is offering for the company? I'm still trying to nail this down, but don't be fooled: just because the deal hasn't been completed doesn't mean there's not a lot of backroom dramas still playing out.
A couple of things to consider here: There's been a lot of talk that the longer Yahoo delays, the more the risk is that Microsoft will walk from the deal. I don't believe that's a worry. I think Microsoft is on the hook to get a deal done, it doesn't merely want Yahoo, it craves it, and I'd be surprised if Microsoft walks. And Yahoo knows it. But more importantly, Yahoo has that pesky fiduciary responsibility to shareholders to maximize value, and that includes getting top dollar for the company, and also running that company day to day as successfully as it can. And herein lies the problem.
As the uncertainty continues, top Yahoo executives are walking out the door. Some to Google, some to startups, some just leaving with no idea where they're going next. Some Yahoo critics will argue that those execs are at least partly responsible for the hole Yahoo's dug for itself, so their departures may not be such a bad thing. But that's shortsighted. Yahoo can ill-afford a brain drain as much as it can ill-afford to leave an offer like this on the table.
I totally get it if Yahoo were shopping itself around to a large group of potential suitors. But here we are, two months after the Microsoft bid, and all we've heard is speculation about who might be out there willing to step up and take on Microsoft. Time Warner? Nothing. News Corp[NWS
Loading...
()
].? Nothing. Google [GOOG
Loading...
()
]? Nope. I mean, come on. JP Morgan [JPM
Loading...
()
] and Bear Stearns [BSC
Loading...
()
] got a deal done in under 48 hours, from beginning to end, something Jamie Dimon called remarkable yesterday. But the two sides were motivated by desperation.
Some might argue that Yahoo ought to be motivated by the same kind of desperation and the foot-dragging the company has shown over the past eight weeks is as stunning as it is disappointing. Some insiders at the company tell me Yahoo's CEO Jerry Yang -- and the board members who support him--is letting personal animosity and hubris cloud his judgment from seeing the obvious.
Microsoft isn't merely a good option, or even the best option, some analysts say. It's the only option. With executives walking out the door, a stock going nowhere, and Google certainly not sitting still, Yang's delay is only delaying the inevitable. And reducing Yahoo's value along the way.
Questions? Comments?
Del.icio.us
Digg It
Data is a real-time snapshot *Data is delayed at least 15 minutes