Microsoft is pushing for a speedy acceptance of its $44.6 billion bid for Yahoo! even as the Internet giant’s board remains mum on the prospect of a blockbuster takeover.
“We think it’s in our interest, in Yahoo!’s interest to resolve their future as quickly as possible,” Microsoft Chief Financial Officer Chris Liddell told analysts yesterday at an investor meeting. “Our thinking in striking what we consider to be an attractive price was to make it as attractive as possible to move quickly.”
Microsoft CEO Steve Ballmer seconded the sentiment, noting, “The No. 1 thing we’re trying to do is increase scale and increase capacity to give ourselves a better chance to be more successful more quickly.”
Yahoo!’s other options appear increasingly limited.
While word surfaced yesterday that Google CEO Eric Schmidt has reached out to Yahoo! to offer Jerry Yang, its reluctant-to-sell chief executive, help in fending off Microsoft’s advances, analysts cautioned that it might not be in Yahoo!’s best interests.
Merrill Lynch analyst Justin Post said in a note to investors yesterday that while Yahoo! should use the offer as negotiating leverage with Microsoft, actually going through with a Google alliance – presumably in the form of a search outsourcing deal – could result in Google gaining a competitive advantage over Yahoo!.
Post said Google could use the relationship to build its brand as a Web starting point over Yahoo!’s, limit advertiser synergies for Yahoo! and gain competitive information about Yahoo!.
Yang’s problem is that Google is about all he has at this point.
Despite talk of other interested bidders jumping into the fray, no one else has emerged to date.
Stifel Nicolaus analyst George Askew panned the idea that private-equity bidders are coming. “The financing and operational risks are too high; the cash flows are insufficient; and Microsoft would likely top any competing bid with its own deep pockets and synergies,” he said in a note.
Askew suggested a competitive bid would require a $36 per share offer valued at $51.5 billion, a 40 percent equity investment including $10.5 billion new private equity and $4.7 billion from Yahoo!’s founders, and $22.9 billion in debt.
“We expect Yahoo! management to resist the deal, believing perhaps that [Yahoo!] shares are worth more. . . Unfortunately, a lot has changed in the past year,” Think Equity tech analyst William Morrison said in a note to investors. brian.garrity@nypost.com