Microsoft issued another letter to the Yahoo board of directors on Saturday with a deadline of 3 weeks for the company to accept the previous $44.6 billion takeover offer that Microsoft proposed in the beginning of February. Despite some recent talks between the two companies, an agreement has not been made and Microsoft is starting to lean heavy on the search engine firm’s board by threatening to go straight to the shareholders if necessary.
“If we have not concluded an agreement within the next three weeks, we will be compelled to take our case directly to your shareholders, including the initiation of a proxy contest to elect an alternative slate of directors for the Yahoo! board,” the letter read. “The substantial premium reflected in our initial proposal anticipated a friendly transaction with you. If we are forced to take an offer directly to your shareholders, that action will have an undesirable impact on the value of your company from our perspective which will be reflected in the terms of our proposal.”, stated Steve Ballmer’s letter to Yahoo.
According to the letter if Yahoo does not accept Microsoft’s offer within the 3 week timeframe, Microsoft will bypass the board and bring a lower offer directly to the shareholders along with a proxy battle to elect a different board that would be more inclined to accept the offer. Ballmer continues to stress the benefit that the original offer has to the shareholders of Yahoo, and also cited that over the past couple of months Yahoo’s pageview and search share have declined and they have made changes within the company to make a takeover even more difficult for Microsoft.
Yahoo has had conversations with other companies in the industry looking for other alternatives, including Google, AOL and News Corp, and Ballmer hinted to these discussions in his letter but also indicated that no authorization has been given to Yahoo management to negotiate with Microsoft. Microsoft appears to have no intention of waiting around for Yahoo to find alternative plans either ending the letter, “We think it is critically important not to let this window of opportunity pass.”