Microsoft goes after Yahoo
Microsoft has made a $44 billion takeover bid for Yahoo. The merger would offer Yahoo the chance to compete with a certain search engine that seems to be dominating online advertising. Steve Henn has the story.
Microsoft and Yahoo logos in front of their respective headquarters. (Paul J. Richards (Top) and Hector Mata (Bottom)/AFP/Getty Images)
More on Wall Street
TEXT OF STORY
Renita Jablonski: Feeling hungry this morning? Microsoft is. The software goliath has offered to gobble up Yahoo with a $44 billion takeover bid. Marketplace's Steve Henn reports.
Steve Henn: The deal offers Yahoo's shareholders a 62 percent premium above what their stock was trading at just yesterday. But analysts say unlike the late 90's, when Microsoft seemed unstoppable, today's deal is a glaring example that executives there are increasingly panicked about a certain search engine that must not be named.
Microsoft explained its bid in a statement today saying the market for online advertising is quote, "increasingly dominated by just one company." Read: Google. Even after a merger, the combined companies would have just 27 percent of online search advertising, and they'd trail Google by 13 percent in all online ads.
But Microsoft's executives say a merger with Yahoo would give the combined company the resources and market share to become a serious competitor. Before that happens, the final details of a deal need to hammered out and win the blessing of federal regulators.
In Washington, I'm Steve Henn for Marketplace.
