WISCONSINREPORT.COM (02/01/08) - The chairman of the U.S. Senate Antitrust Subcommittee is concerned about the possible implications of a merger of Microsoft and Yahoo. Microsoft is offering to purchase Yahoo for about 44 Billion Dollars. Industry sources say Microsoft is looking to increase it's competitive position against Google's growing internet empire. Democratic United States Senator Herb Kohl from Wisconsin is the chairman of the Antitrust subcommittee. Kohl says hearings are being considered if Yahoo accepts the Microsoft offer.
Microsoft Corporation (Nasdaq: MSFT) today announced that it has made a proposal to the Yahoo! Inc. (Nasdaq: YHOO) Board of Directors to acquire all the outstanding shares of Yahoo! common stock for per share consideration of $31 representing a total equity value of approximately $44.6 billion.
Microsoft's proposal would allow the Yahoo! shareholders to elect to receive cash or a fixed number of shares of Microsoft common stock, with the total consideration payable to Yahoo! shareholders consisting of one-half cash and one-half Microsoft common stock. The offer represents a 62 percent premium above the closing price of Yahoo! common stock on Jan. 31, 2008.
Following the news of the possible deal, U.S. Senator Herb Kohl (D-WI), chairman of the Senate Antitrust Subcommittee, issued the following statement.
"The possible deal involving Microsoft and Yahoo! combines two of the world's most prominent internet companies," Senator Kohl said.
"We will need to scrutinize the deal carefully to insure that it will not cause any harm to the competitiveness of what has been a vibrant high tech marketplace, nor negatively impact the privacy rights of internet users," the veteran U.S. Senator pointed out.
"As in our recent examination of the Google/DoubleClick deal, we will need to investigate how this combination affects consumers, advertisers and businesses who increasingly use the internet for their news, commerce and entertainment," Kohl said.
"Should Yahoo! accept Microsoft’s offer, the subcommittee expects to hold hearings to explore the competitive and privacy implications of the deal," the Antitrust Subcommittee chairman stated.
Microsoft CEO Steve Ballmer has some insight on why the Yahoo board of directors has been approached with the offer.
"We have great respect for Yahoo!, and together we can offer an increasingly exciting set of solutions for consumers, publishers and advertisers while becoming better positioned to compete in the online services market," said Steve Ballmer, chief executive officer of Microsoft.
"We believe our combination will deliver superior value to our respective shareholders and better choice and innovation to our customers and industry partners," Ballmer said.