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On Saturday, Microsoft jerked the proposal to acquire internet giant Yahoo, saying that Yahoo has refused to move on the price. This, despite Microsoft increasing the offer to almost 50 billion dollars. The talks to buy out Yahoo began on February 1 but have ended since the two companies were not able to close the price expectations. Earlier, the software giant had offered to buy Yahoo for 31 dollars per share. Microsoft Chief Executive Steve Ballmer said that despite their best efforts which included raising the bid by almost five billion dollars. Yahoo has not accepted the offer. He further added that the price demanded by Yahoo did not make sense for Microsoft and it hence decided to pull back the offer completely for the benefit of the Microsoft stock holders as well as all other stake holders.
In a letter which was addressed to Yahoo's Chief Executive Jerry Yang, Ballmer said that Microsoft had raised the price of per share to $33. The resultant price increases had added almost five billion dollars to the whole bid. Meanwhile, Yahoo on Saturday brushed aside Microsoft's cancelled takeover bid as a distraction. He said that Yahoo might be struggling now, but promised that it is set for better days ahead. After the deal was called off, Yang said that now Yahoo will focus on executing the most important transition so that it can benefit the share holders, employees, partners and even the end users.
Many financial analysts believe that Microsoft did the right thing by not going ahead with the deal as Yahoo's stock prices are now expected to fall drastically by Monday. They believe that because Microsoft was continuously upping its bid, Yahoo's stock prices were going up as a result. But, now that the deal has been called off, Yahoo's stock prices will come down.
Microsoft's plan was to combine its own online resources with that of Yahoo in a bid to gain some lost ground against the online advertisement giant Google.
