Yahoo Just Says No To Microsoft

Holding out for more money, Yahoo's board of directors has officially rejected Microsoft's $44 Billion USD Bid for the struggling company. The board stated that the bid didn't put enough value on their company, in spite of its recent financial struggles.

The rejection by the board comes shortly after their shareholders launched a lawsuit for a previous rejection of a Microsoft offer. The shareholders felt then that the board was not acting in the shareholders' best interests. With this rejection of a bigger offer, Yahoo's board may have put the company in a precarious position.

Microsoft has the option now to take their hostile bid to the shareholders directly, over riding the board completely. With the shareholders already displeased over the rejection of a previous offer, Yahoo's board may have just unwittingly helped speed up the hostile takeover they were trying to prevent.

Speculation is rife that Google may use this window to step in and prevent Microsoft from gaining a foothold online. At this point, if Google's offer of a bail out for Yahoo from earlier this month is still on the table it may become a race against time. Google can still take their offer to the board, Microsoft can increase their offer and take it back to the board, or Microsoft can take their existing offer to the shareholders. Yahoo's future maybe depend on who gets to who first.

Opinions vary on which company would be better or worse in bed with the Internet pioneer. I'd prefer to see Google "win", because their plans for Yahoo, as stated, leave Yahoo with autonomy, which is better for their current properties like Flickr. Some people, like Profy's own Cyndy Aleo-Carriera, disagree, wanting Microsoft to "win" to prevent a search and ad revenue monopoly on Google's part. Regardless of which company you think should win, the board rejection definitely ups the ante in this online bidding war.