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Monday, February 25, 2008
Microsoft chairman says Google is only firm with ‘critical mass’; terms bid for Yahoo as ‘very fair’ and MS is ready to invest heavily in Web even if the bid doesn’t work
SEATTLE: Microsoft Corp plans to invest heavily in Web search to compete against Google Inc, even if it fails to acquire Yahoo Inc, the company’s chairman Bill Gates said on Monday.Gates, who called Microsoft’s offer for Yahoo “very fair”, said Google is the only company with “critical mass” in Web search.
He added that Microsoft needs a bigger piece of the market to create a more competitive and profitable Web search business.
“We can afford to make big investments in the engineering and marketing that needs to get done. We will do that with or without Yahoo,” said Gates.
‘THOUGH YAHOO WOULD BE A HELP’
“But we also see that we’d get there faster if the great engineering work that Yahoo has done and the great engineers there were part of the common effort,” said Gates, who is Microsoft’s biggest shareholder.
The two companies are at a standoff in Microsoft’s $44.6-billion unsolicited bid to acquire Yahoo. Microsoft has offered to buy Yahoo for $31 a share in cash and stock, a bid which Yahoo’s board rejected, saying it undervalued the company.
Microsoft countered by saying its offer was “full and fair,” but did not say what it planned to do next.
Analysts expect Microsoft to sweeten its bid, possibly to $35 a share, to clinch a deal.
“There is nothing new in terms of the process. We’ve sent our letter and we’ve reinforced that we consider that it’s a very fair offer,” said Gates, who remains the public face of Microsoft, even though he plans to switch to a part-time role at the company in June to focus on his philanthropic work. REUTERS BUT WILL YAHOO TAKE THE BAIT?
Meanwhile, there are indications that Microsoft may succeed in fighting off rival suitors for Internet search company Yahoo because they can’t offer as much to Yahoo’s shareholders.
Yahoo, seeking alternatives to Microsoft’s $44.6-billion bid, is in talks with News Corp. London’s Sunday Telegraph reported that Time Warner’s AOL is also in talks with Yahoo. A partnership won’t help regain the lead in search from Google, experts said.
“You’re not curing any weaknesses. Shareholders would have a hard time loving any combination like the above,” said one.
- Reference by Mumbai Mirror :dated on 20th of Feb 2008
Labels: Business, Technology
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