Your move, Mr. Ballmer.
That’s essentially the message Yahoo! sent to the Microsoft CEO with its decision yesterday to extend the March 14 deadline to nominate directors to its board.
And if Yahoo! CEO Jerry Yang thought his famously fiery counterpart was hostile before, just wait until he sees how ballistic Ballmer is going to get now, sources said.
“Ballmer is just one of many highly emotional people involved in this,” said a source who has spoken with executives at both companies. “Microsoft has been trying to avoid going completely hostile, but now it is going to get completely hostile.”
Interpretations of Yahoo!’s move – which extends the deadline to nominate board directors to 10 days following the announcement of its annual shareholders meeting – vary wildly.
Some think the move was made with good intentions, subtly signaling to Microsoft to be patient while Yahoo!’s board fulfills its fiduciary duty to seek out alternatives before agreeing to a deal with them.
Others, however, view the extension as a scorched earth attempt to hold off Microsoft as long as possible while Yahoo!’s business continues to deteriorate and its executives flee in droves, thereby depleting the deal’s intrinsic worth.
“Our objective here is to enable our board to continue to explore all of its strategic alternatives for maximizing value for stockholders without the distraction of a proxy contest,” Yang wrote in an e-mail to employees.
Though no date has been announced yet, under Delaware law Yahoo! must hold its annual shareholder meeting by July 12.
But Yang may end up facing a proxy contest anyway.
Just because Yahoo! extended the deadline to nominate directors doesn’t mean Microsoft must hold off on nominating them, and sources said the software giant has not only compiled its slate, but may still go public with it next week.
Sources also said that Microsoft is considering changing its offer to 100 percent cash as a way to further entice Yahoo! shareholders and pressure its board, and is actively trying to convince Japan’s Softbank, which owns 3 percent of Yahoo! and about 40 percent of Yahoo! Japan, to come out in favor of its offer.
Moreover, Ballmer knows that the longer he waits for Yahoo!, the more time competitors like Time Warner and News Corp., which owns The Post, have to figure out an alternate deal structure.
Indeed, sources said Ballmer is completely dismayed that Yahoo! would go out of its way to court AOL while still not engaging Microsoft in talks.
And though sources close to Yahoo! tried to portray the board nomination extension as a way to give Microsoft more flexibility, the reality is that it is giving them less: Either Microsoft goes completely hostile or risks losing Yahoo!