Microsoft Makes $44.6 Billion Bid for Yahoo! - Culture Clash
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Some think Yahoo may have to give up its very soul if it chooses to merge with Microsoft. Jerry Yang’s hatred of Microsoft products reaches legendary proportions; supposedly he will do just about anything to avoid using them. But the cultural differences run even deeper, as I’ve already hinted.
When Yahoo was born, Microsoft had already been in existence for 25 years and become a software powerhouse. Yahoo prospered in the early days of the Internet, developing a free-wheeling, laid-back, idea-intense culture long before Google came on the scene. Microsoft is widely perceived as having a buttoned-down, corporate attitude; just look at Apple’s “I’m a PC and I’m a Mac” commercials to see this in action.
Yahoo was rather low-key in its response to the deal, saying that its board “will evaluate this proposal carefully and promptly in the context of Yahoo’s strategic plans, and pursue the best course of action to maximize long-term value for shareholders.” Some analysts seem to think that Yahoo is now scrambling for other offers (more on that in a bit). The company put Microsoft off for at least a year; some think this was because of Terry Semel, former CEO of Yahoo. Now that he has left Yahoo completely, Yahoo may be running out of delaying tactics.
And Microsoft is, potentially at least, a ruthless player. Most analysts have quoted extensively from Ballmer’s letter to Yahoo. Few noted that the software giant gave Yahoo only two days to prepare some kind of response before going public with the letter. And even fewer noted this tantalizing line from the letter: “Depending on the nature of your response, Microsoft reserves the right to pursue all necessary steps to ensure that Yahoo!’s shareholders are provided with the opportunity to realize the value inherent in our proposal.” Could this be a veiled warning that an unfavorable response may lead to Microsoft starting a hostile takeover bid for Yahoo?
If so, and it comes down to a fight, Microsoft might have a real battle on its hands. Anders Bylund, wrting for Ars Technica, noted back in mid-January that “Shareholders and board members get a serious say in any takeover offer here. Yahoo has an active poison pill provision that would let the board issue tons of additional preferred stock in case of an unapproved buyout proposal.” So Yahoo could at least make it hurt Microsoft to take them over, if they wanted to. Will Yahoo resist the bid?
Next: Will Microsoft Win the Bid? >>
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