Right now, Yahoo shares are flirting with a dangerous threshold of below $15 a share–at this moment, shares are at $12.20 (at the time of writing). The only time Yahoo (YHOO) shares went under the $20 level is when Microsoft (MSFT) mounted its takeover bid for the company, which was unveiled Feb. 1. The price right now means Yahoo substantially below the offer of $33 a share Microsoft offered that was worth upwards of $41 billion. Much like paper certificate sold over e-bay.
Yahoo’s proposed advertising deal with Google (NASDAQ: GOOG) was seen as a way for the company to soothe angry shareholders and boost its finances. Opposition from government antitrust regulators ended that possibility.
David Drummond, Mountain View-based Google’s chief legal officer and senior vice president for corporate development, wrote that after four months of review, “it’s clear that government regulators and some advertisers continue to have concerns about the agreement. Pressing ahead risked not only a protracted legal battle, but also damage to relationships with valued partners. That wouldn’t have been in the long-term interests of Google or our users, so we have decided to end the agreement.”
“Spend $15 billion, and you could not build a new Yahoo today–not one with this global reach and brand,” Henry Blodget notes over at Silicon Alley Insider.
For all its management problems, Yahoo remains Microsoft’s single most important path to winning in the online display business and at least keeping itself in the game with Google in search and the search-ad business.
“To this day, I believe the best thing for Microsoft to do is to buy Yahoo,” the Associated Press quoted Yang as saying late on Wednesday at the Web 2.0 summit in San Francisco.
And, if you really think hard about it, it is still Microsoft’s best chance to shine.
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