Yahoo! Inc has rejected a joint proposal from Microsoft Corporation and billionaire investor Carl Icahn for a restructuring of the global internet giant
SAN FRANCISCO: Yahoo! Inc has rejected a joint proposal from Microsoft Corporation and billionaire investor Carl Icahn for a restructuring of the global internet giant, saying the deal was not in the "best interest" of stockholders.
"After reviewing the proposal with its legal and financial advisers, Yahoo!'s Board of Directors determined that accepting the proposal is not in the best interests of its stockholders," Yahoo! said in a statement on Saturday night.
Yahoo! had received the joint proposal from Microsoft and Icahn, an arrangement that would include the acquisition of the internet major's search business by Microsoft and the rest of the company by Icahn.
"The proposal was made on Friday evening and Yahoo! was given less than 24 hours to accept the proposal, the fundamental terms of which Microsoft and Icahn had made clear they were unwilling to negotiate," Yahoo! said.
The terms included the immediate replacement of Yahoo's board and removal of top management, the statement said, terming the proposal completely "absurd and irresponsible". "This odd and opportunistic alliance of Microsoft and Carl Icahn has anything but the interests of Yahoo!'s stockholders in mind," Yahoo! Chairman Roy Bostock said.
"Yahoo!'s board remains open to any transaction that delivers full value to our stockholders - we just do not believe such a transaction should be dictated by Microsoft and a single short-term investor," the statement added.
Yahoo! said a transaction to acquire the whole company would be much more straightforward and involve far less risk than the new proposal or any similar alternative.
Bostock said, "Microsoft and Icahn are trying to dismantle the company and deliver our search business to Microsoft on terms that would be disadvantageous to Yahoo! stockholders."
"We are prepared to let our stockholders, not Microsoft and Carl Icahn, decide what is in their best interests and we look forward to the upcoming vote," he added.
Acknowledging that the Microsoft-Icahn proposal represented "a number of improvements" over the earlier one, Yahoo! said it not only repeated its offer to sell the entire company to Microsoft for at least USD 33 per share, but also offered to negotiate an improved search only transaction. Microsoft rejected both offers.
The revenue guarantees suggested are well below the search revenue that Yahoo! is expected to generate on its own and in association with its announced commercial agreement with Google, the statement added.
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