Media News - Monday, July 14, 2008

Yahoo rejects joint Microsoft proposal

Yahoo Inc on Saturday rejected a proposal to sell its search business to Microsoft Corp and hand over the remainder of the company to activist investor Carl Icahn. Yahoo said in a statement it received the joint proposal from Microsoft and Icahn on Friday evening and was given less than 24 hours to accept. It said Microsoft and Icahn made clear they were unwilling to negotiate the fundamental terms, which include the immediate replacement of Yahoo's board and removal of top management. The company said the 'take it or leave it' deal that was offered would also preclude a potential sale of all of Yahoo 'for a full and fair price, including a control premium.' The move comes a few weeks before Yahoo's annual meeting on August 1, when Icahn is seeking to oust Chief Executive Jerry Yang and replace the nine-member board with his own slate of directors. Icahn owns nearly 5 percent of Yahoo shares. Microsoft, which has been embroiled in on-again, off-again deal talks with Yahoo for six months, has said it no longer wants to negotiate with Yang's team, but that it is willing to resume talks if a new management is in place on August 1. (Reuters)

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