Shares of Yahoo rose by 19 percent, after reports of the company’s merger with Microsoft. Apparently, the winner was Yahoo, having resisted a take-over, but benefitting from higher stock prices.
It was momentary, though. The prices were back to normal, once reports came out that there would be no merger, but joint-venture to take on Google, their common enemy. Meanwhile, Microsoft shares dropped over 1 percent.
Reports and speculation suggests that Microsoft had valued Yahoo at $50 billion, but the offer was sternly rejected by Yahoo. Yahoo’s current market value stands at $45 billion, $7 billion more than the value before the reports came out.
Experts said that the merger would be a dream-come-true, and that the resulting giant would be able to give Google a run for its money. But they also say that such a takeover would probably be just a dream, since the giants are hugely different in their strategies and interests.
Microsoft had taken this acquisition proposal seriously, having roped in investment bank Goldman Sachs for the process.
Despite the interests in Yahoo by Microsoft, many consider this acquisition, if it ever comes true, to be a jolt for MS. Yahoo is in a low state of growth, trailing Google by quite a margin in revenue and search market share. Experts also say that competing with the global search giant, Google, will not be the smartest thing to do, since Google is far ahead. Also, MS’s recent online acquisitions have been largely failures.
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