YAHOO OFFERS TO SELL FOR $33/SHR
A deal to separate Yahoo's search and display businesses was an undertaking of great complexity, the company said, and could take up to one year to obtain regulatory approval.
It would be much more straightforward and less risky to sell all of Yahoo to Microsoft, and such a deal could be negotiated and executed before August 1, Yahoo said.
But it added that Microsoft had again rejected its repeated offer to sell Yahoo for at least $33 per share. Yahoo, whose shares are trading at around $23.50, said Microsoft also refused to negotiate an improved search-only transaction.
The company said the revenue guarantees suggested by Microsoft were conditional and subject to reduction, and were "well below" the search revenue that Yahoo was expected to generate on its own and with Google.
It also said other components of the proposal that Icahn and Microsoft put forward, such as spinning off Yahoo's Asian assets, could be undertaken by Yahoo on its own and that its board continued to evaluate these measures.
Yahoo said it was ironic that Icahn, who had previously urged the company not to sell its search business to Microsoft, was now supporting a proposal to do exactly that.
But sources familiar with the matter told Reuters earlier that Icahn would support a partial deal with Microsoft if it guaranteed revenue of at least $2.5 billion a year to Yahoo.
Bostock called it "completely absurd and irresponsible" of Microsoft not to engage with Yahoo's management as it would be a very complex thing to do to hive off half the company's business and integrate it into the software maker.
"While this type of erratic and unpredictable behavior is consistent with what we have come to expect from Microsoft, we will not be bludgeoned into a transaction that is not in the best interests of our stockholders," Bostock said.
Microsoft and Icahn were not available for comment.
