One unnamed source commented “Thereis no reason to bid against ourselves.”
Reports in March, however, seemed to indicate that Microsoft was considering an increase in its buy out offer. Citigroup analyst Mark Mahaney commented at the time “”While we continue to see no other competing bidders, we believe Yahoo is aggressively pursuing strategic alternatives. We believe this could serve as a forcing function to a higher Microsoft bid.”
Microsoft presented Yahoo with an unsolicited buy out offer early in February following the Internet search and advertising company reported a 23 percent drop in earnings. Yahoo shot down the offer claiming that Microsoftis bid was undervaluing the company.
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Despite the Yahoo rejection, Microsoft has maintained that it plans to continue pursuing the buyout. The company stated “Microsoft reserves the right to pursue all necessary steps to ensure that Yahoois shareholders are provided with the opportunity to realize the value inherent in our proposal.”
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