Don't you just love when the one person who didn't want anything to do with you suddenly needs you? Well, in today's crazy online world, that's exactly what's going on with Jerry Yang and Microsoft. Just a few months ago, Yang was doing everything he could to turn Microsoft away. And now, he needs to do everything he can to bring them back.
If you haven't been following the latest on the Yahoo front, the company's stock price has plummeted (it's at $21.61 right now, way down from its $29 share price back in February); executives are getting out of town as quickly as possible as a reorganization gets underway; Carl Icahn is exerting unbelievable pressure on Yang; and shareholder confidence in Yahoo is dropping by the minute.
All the while, Yang has tried to save what's left of his bleeding company, but to no avail. Unless something major happens soon, Yahoo will be far beyond the point of saving and although the very thought of selling the company to Microsoft runs against Yang's own principles, what other option does he have?
In order to save Yahoo and maybe walk away with some cash himself, Yang has no other choice but to strike a deal with Microsoft and walk away from this albatross. And although Microsoft was willing to offer a substantial premium on the stock price, which saw the value reach into the mid-thirties per share, don't expect anything of the sort this time around.
Based on the financial health of the company, the incredible internal problems, and the fact that Yang no longer holds any leverage, I don't see Microsoft offering more than $25 per share.… Read more