May 5, 2008
Yahoo Successfully Blocks Microsoft Offer
Microsoft has withdrawn its offer for Yahoo. The Yahoo board demanded $37 a share and Microsoft only offered in the low 30s. The Yahoo board demand is cheeky considering that the Microsoft offer came on the heels of a four year low stock price of $20 a share. Look for Yahoo stock to drift down and for Yahoo shareholders to be left wondering whether or not they have missed the boat.
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An article in today's WSJ ("Jerry Yang's Scorched Earth") rips Yahoo for failing to sell at such a premium. It closes with a warning to Yang, "see you in Delaware Chancery Court." However, it is unclear to me whether Yahoo did anything, such as acceding to a change in control, that would put its actions under Revlon zone scrutiny. Hence, Yahoo's failure to sell at the highest price would be irrelevant. How would this turn out under Unocal analysis? Did Yahoo do anything drastic to block the bid, or simply fail to sell a controlling block of shares?
Posted by: Vince | May 7, 2008 8:38:25 AM