Update Microsoft went public Friday with a $44.6 billion cash-and-stock bid to acquire Yahoo. In its response, Yahoo called the Microsoft bid “unsolicited” but did not reject it. Microsoft’s offer, which was contained in the letter to Yahoo’s board, amounts to $31 a share and represents a 62 percent premium over Yahoo’s closing price on Thursday. Microsoft said it will offer shareholders the option of cash or stock. “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,” Microsoft CEO Steve Ballmer said in a statement. Yahoo said in a responding statement 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.” The deal comes as Microsoft and Yahoo have both struggled to compete against Google. Microsoft didn’t mention Google by name in its announcement, but it did indicate that its acquisition bid was aimed squarely at its rival. “Today, the market is increasingly dominated by one player, who is consolidating its dominance through acquisition,” Microsoft said. “Together, Microsoft and Yahoo can offer a credible alternative.” In a conference call Friday morning, Ballmer said that Microsoft and Yahoo “really do share a vision for the potential of online services.” Microsoft said in its statement that it believes that it can get all of the needed regulatory approvals and that the deal, if ultimately approved by Yahoo shareholders, could be completed in the second half of the year. Read More...

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