Analyst says Microsoft’s Yahoo bid is a ploy

Feb.07, 2008 in Market Outlook

Analyst: Microsoft’s Yahoo bid may be fake

Bid designed to keep Yahoo from deal with Amazon.com, report says

By Benjamin Pimentel, MarketWatch

Last Update: 3:06 PM ET Feb 7, 2008

SAN FRANCISCO (MarketWatch) — As the world awaits Yahoo Inc.’s response to
Microsoft Corp.’s bold bid to buy the Internet giant, one analyst has come out
with an intriguing take on the proposed marriage: It’s probably a ploy.

Trip Chowdhry of Global Equities Research speculated Thursday that Microsoft
(MSFT) made the stunning $44.6 billion merger proposal as a way to block a
possible alliance between Yahoo and another Internet behemoth, Amazon.com.

Chowdhry also believes the Microsoft-Yahoo merger will not pass muster with
regulators, even if Yahoo (YHOO) accepts the bid.

Microsoft dismissed Chowdhry’s speculation.

“As to Microsoft intentions, the report is completely incorrect,” a spokesperson
said in a written statement. “As we made clear in our letter to the Yahoo board,
our bid offers Yahoo employees and shareholders a significant premium and the
opportunity to participate in the upside of the combined company.

“We continue to believe that the proposed combination would receive all necessary
regulatory approvals and expect that the proposed transaction would be completed
in the second half of calendar year 2008.”

That analysis runs counter to the predominant view of financial and industry
analysts who believe that, while the deal faces many challenges, Microsoft’s plan
to gobble up Yahoo will likely succeed. More on the Battle for Yahoo.

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