Is There A Second Buyout Offer Coming from Microsoft?

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Is Jerry Yang the most unpopular CEO of a publicly traded technology company right now?

Probably.

Jerry Yang and company famously rebuffed Microsoft and Steve Ballmer earlier this year. Microsoft made an aggressive bid to acquire Yahoo!, but eventually walked away from the negotiations after deciding that the asking price was just too high. Microsoft (according to published reports) made a last-ditch bid to acquire the company at $33 per share, but Yang reportedly asked for $37 per share. Ballmer felt that this was just too rich of a valuation and ended up walking away.

Fast-forward to today. To say that Yahoo! is in shambles would be the understatement of the century.

Yahoo! is currently trading at $14.43 a share, a far cry from the $33/share that Microsoft offered just a few months ago.

Google recently walked away from a proposed partnership with Yahoo!, citing anti-trust concerns.

Many key cogs in the Yahoo! management team have walked.

Many major shareholders in the company are extremely upset with Jerry Yang, and feel that he should resign.

In a recent Q&A session at the Web 2.0 summit in San Francisco, Jerry Yang desperately tried to fan the flames of another potential Microsoft buyout offer.

He said that "the best thing for Microsoft to do is to buy Yahoo" and that he "respects Steve Ballmer." He also said that he is "open to a sale to Microsoft" and that "both sides are to blame for the deal not happening." Steve Ballmer disagrees, I'm sure, but that's another story.

Jerry Yang is clearly under a great deal of pressure from his shareholders and wants out. The question is, will Microsoft re-open the negotiations and try to acquire Yahoo! at a much-lower price? Some analysts are suggesting that Yahoo! might be willing to sell for something in the neighborhood of $20/share now.

To be honest, Yahoo! and Jerry Yang really don't have a lot of options right now. Their business is stagnant (to put it gently), key pieces of the management team are defecting and shareholders don't have any confidence in the leadership of Jerry Yang. Google has walked away from a proposed partnership and there doesn't seem to be too much other interest from other companies.

Microsoft seems to be Yahoo's only option at this point - however, is Microsoft interested? We'll soon find out if Jerry Yang's public grovelling has had any impact.
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