Yahoo Investor Calls Microsoft Threat a Blunder

Stakeholder Legg Mason will support Yahoo if Microsoft tries to drop price
By Jim O'Neill,  Newser User
Posted Apr 9, 2008 11:28 AM CDT
Yahoo! Mobile president Marco Boerries delivers a keynote during the CTIA wireless show at the Hilton in Las Vegas on Wednesday, April 2, 2008.    (AP Photo/Isaac Brekken)
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(Newser) – Yahoo received a tepid endorsement from its second-largest shareholder yesterday as its takeover battle with suitor Microsoft continued to heat up, the Wall Street Journal reports. Legg Mason, which holds a 7% stake in Yahoo, said it would back an independent Yahoo before it would sell its stake at a reduced price—and Microsoft's CEO "blundered" by threatening to go that route.

Steve Ballmer told Yahoo’s board it would launch a proxy battle and likely lower its price if Yahoo didn’t agree to a deal within three weeks. Yahoo called the ultimatum "counterproductive;" Legg portfolio manager Bill Miller said if Microsoft ups its offer “the pressure shifts very quickly to Yahoo to negotiate.”