Although Yahoo rejected Microsoft’s first bid, this battle is far from being over. Believe it or not, Microsoft is going to continue to push for a deal within the next few days. At this time, it appears that Microsoft is taking all of the appropriate steps to start a proxy battle with Yahoo.
Many people are not aware of what it means to wage a proxy battle. Simplifying this process is no easy task, but there are some details that can be seen on the surface. It is Microsoft’s hopes that after putting together a list of directors to take over Yahoo’s board, that the majority of stockholders would support this effort. If this happens, Microsoft will be able to more or less bully Yahoo into making the transaction.
If Microsoft moves forward with its proxy battle, it is sure to spend a lot of money during the process. Industry experts are predicting that Microsoft would have to spend approximately $20 to $30 million to complete the process. As you can imagine, they would much rather have Yahoo agree to a friendlier takeover. Not only would this save them money, but it would save them a lot of time as well.
Over the next few days it will become clearer if Microsoft plans to move forward with a proxy battle. If they decide that this is the best route, they will need to secure a list of Yahoo’s majority shareholders so that they can contact them one on one. As the process moves forward, at Yahoo’s annual meeting in May, the vote for new directors would take place.
At this time, most industry experts feel that Microsoft will move forward in this direction. Not only will they move forward, but many insiders also agree that they will be successful in their endeavors.
Microsoft Chairman Bill Gates said, “We sent them a letter and said we think that’s a fair offer. There’s nothing that’s gone on other than us stating that we think it’s a fair offer. They should take a hard look at it.”
The question is: what will Yahoo decide to do after they take a comprehensive and hard look at the offer? The answer to this question is sure to come out sooner rather than later.
Comments
Jacob Jones said on February 25th at 08:00 am,
I feel that yahoo has missed out on a great opportunity to sell themselves to microsoft because of their failing and dropping rates at stock exchange. I actually felt that they are a little too much over priced at even $31 and was equally surprised to see yahoo rejecting that offer. I feel that microsoft should not try buying yahoo again.