Microhoo or Screw You? - Microsofts Option 2
2. Forget the Meetings; Just Up the Ante
Since Yahoo rejected Microsoft's offer Feb. 11, the popular opinion is that Microsoft will lob the ball back into Yahoo's court with a higher bid than the original $31 per share offer. Consensus among financial analysts puts the counteroffer at $35-$40 per share, driving Yahoo's cost over the $50 billion mark. Legg Mason principal Bill Miller said $40 sounds about right. Shareholders tired of Yahoo's underperforming stock will have a tough time looking this gift horse in the mouth.
Since the ink dried on Microsoft's original $44.6 billion purchase offer for Yahoo on Jan. 31, Yahoo has been turning every which way for help, wheeling and dealing to avoid becoming the rival software giant's lunch. Here are some scenarios-