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Microsoft’s Yahoo Bid 'Ridiculous'

Posted Feb 18, 08 2:40 PM CST in Business,  Technology 

(Newser) – Investment manager Joe Rosenberg takes a swipe at Microsoft's bid for Yahoo in this week's Barron's, disparaging both the deal and CEO Steve Ballmer's financial acumen, Reuters reports. "It's a bad reflection on Ballmer that he's willing to pay a ridiculous price for Yahoo,” says Rosenberg. “Microsoft is not going to earn anything like a reasonable rate of return in Yahoo." An increased bid, which Yahoo is seeking, would be even worse, he says.

The market seems to agree: Microsoft's stock dropped four points since its bid, closing at $28.42 Friday. That value destruction nearly equals Microsoft’s offer for Yahoo, Rosenberg notes, warning that Ballmer should be nurturing his stock’s value to avoid losing employees tired of underperforming shares. "The best thing of all would be if Microsoft drops the bid," he adds.

Source Reuters

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Microsoft CEO Steve Ballmer smiles during a talk at the Web 2.0 conference in San Francisco, Thursday, Oct. 18, 2007. Microsoft Corp. said Thursday, Oct. 25, 2007, its fiscal first-quarter profit rose...   (Associated Press)
The Yahoo Center office building is seen in Santa Monica, Calif. in this Feb. 2, 2008 file photo. Yahoo Inc. on Monday, Feb. 11, 2008 spurned Microsoft Corp.'s $44.6 billion takeover bid as inadequate,...   (Associated Press)
Yahoo CEO Jerry Yang gives a keynote address at the Consumer Electronics Show (CES) in Las Vegas, in this Jan. 7, 2008 file photo. Yahoo Inc. Chief Executive Jerry Yang told employees Wednesday Feb. 6,...   (Associated Press)
This combination of two file photos shows Microsoft CEO Steve Ballmer, left, and Yahoo CEO Jerry Yang. Yahoo Inc. on Monday, Feb. 11, 2008 spurned Microsoft Corp.'s $44.6 billion takeover bid as inadequate,...   (Associated Press)
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