Microsoft gives Yahoo deadline on offer and threatens a "hostile takeover"

Stradius -

There are many different forms of business one can choose when starting a company. If you were to start a business in the form of a Sole Proprietorship, you would have the right to sell (or not sell) your company at your own discretion. However, you are personally liable for your business, and therefore, your personal property can be seized along with your business's property in the event of a lawsuit. In order to separate one's personal property from their business, they must create a corporation (there are many different kinds, Current is a Limited Liability Corporation). Sometimes, a private company decides to sell itself to the public through "shares" on the stock market. Yahoo did this a long time ago, and gave up it's right to control itself to the public, and its founders turned their stake into shares in hopes that their value would increase. Therefore, Microsoft's Board of Directors (the group of people who make big decisions about how the company is run) can decide to use Microsoft's money to buy enough shares in Yahoo! to control the majority of the company, which is 51% of the shares in most cases. This can only happen when a certain volume of shares is available for purchase, meaning that if Yahoo! were more popular right now- if more of its shares were "owned" instead of "available"- Microsoft would be unable to acquire a majority stake. As you can see, this situation is a bit complicated, but that is why Yahoo! can only be a volunteer or a victim in this situation.

Hope that helps, Stradius!

-Ando

The mashing of the companies will not be easy. Yahoo! is known for using open source software to power most of it's services, while Microsoft is closed by nature. The culture clash will be astronomical. Contrary to what most people think, if they merge, they'll be 2 huge losers (in search).

So, in Google's eyes, instead of having 2 bad competitors to combat, they'll have 1 huge loser to destroy.

If Yahoo! takes the bid, I'll be completely shocked.

I can only hope this is another blow to Microsoft that'll continue to put them in their place...

You all may be getting manipulated. If Microcroft wanted Yahoo so bad, they could just offer more money.

The thing is, it's a game and both sides know it.

Once Yahoo!'s stock was on the market Microsoft had all the rights in the world to buy it. And when Yahoo!, a very valueable company, was selling stock cheap, Microsoft could have bought the majority of the stocks. Thus, hostile take over, but instead they told everyone first. Allowing Yahoo! A chance at peaceful merger rather than a simple take over. But now Yahoo! has sprung back to life and microsoft might not even be able to manage the take over they threatened.

Sweet
I got on tv :-)

@furryjenn: Tell that to the flickr users...

@Stradius: That could happen if the state interferes but as you can see the market doesn't works in that way but behind corporates are people trying to get more from their money and the way is competing if you're the smaller one!

That's what Yahoo! Inc. Is doing and Microsoft seems they made a bad move, they let survive their rival and now they're trying to blackmail Yahoo! Inc.

yahoo sucks anyway.

First is it right to let Microsoft take over a leading competitor at all?

Let's see... in the field of competition that would leave Microsoft MSN and.... Google? There isn't much of a legitimate reason for Microsoft to buy Yahoo other than to stomp out another competitor... why doesn't anyone ever see that this is the kind of stuff that tears our country down and will eventually make us the weakest nation on earth?

Second, if Yahoo as a business entity doesn't have the right to say "no"... how is that freedom of competition? What powers exist that allow someone to force their will on another?

Wait a minute... isn't that a little bit like corporate rape?

I really can't be mad at microsoft for setting the deadline. They could have bought Yahoo!(with hostile-takeover) when is was real down in price and down in alot of other ways. But Microsoft went the way of the Samurai and kicked Yahoo! pillow out from under its head(making an official offer) before issueing their threat.

But, now the microsoft realized what a beast it had awoken in Yahoo! it tried to put it back to sleep with a lawsuit, which only made things worse. Microsoft can't sue Yahoo! because Microsoft's offer increased Yahoo! market appeal. That aint right.

Microsoft is really losing it, I don't blame them after Vista came out, that was just a mess.

mischabarrett,

The issue is that Microsoft made with their offer a raise in the Yahoo! Inc. Stocks so now Microsoft wants a payout for the kind of favor they made, only that the market doesn't works in that way.

Microsoft is basically scared cause Yahoo! was losing market so they wanted to take advantage of this but their offer made Yahoo! revives... Anyway, they can't make a hostile takeover even in legal ways in a free market, because that's the market!

" surely you should be able to sell to whoever you choose? "

Or more importantly, not sell at all.

Microsoft has gotten way to big for its britches. Maybe the EU can find away to constrain this sort of bullying. The US certainly won't.

Could Yahoo get the shareholders to rebel? Imagine Microsoft weren't able to stage a hostile takeover because no one would sell to them - I would love that...

Steve Ballmer looks like he's friends with Satan.

I recently left Yahoo to join Current TV. Who would you rather work for: Steve Ballmer or Al Gore? ;-)

yes, mischabarrett, I agree with you. The concept of a hostile takeover is very foreign to me.