Microsoft and Yahoo have been partnering each other for almost two years now, but it seems like Microsoft had never dropped out its plans to takeover Yahoo. Three years down the line, the software giant had given Yahoo an offer to be a part of Microsoft completely, but the deal did not materialize. Yet again, Microsoft is attempting to kick an offer to buy control of Yahoo, officially.
Sources note that Microsoft has signed a confidentiality agreement with Yahoo, joining other potential bidders like the private equity firms Silver Lake and TPG Capital. Reason behind the board’s intention to buy Yahoo, might have been in talks as the investors believe is a trove of riches that could be unlocked by providing stronger management.
But considering the fact that Yahoo was a super power in 2008 and its current condition is pathetic, which is only turning worse as the day passes, the decision might face a few roadblocks. Yahoo has fallen behind Google and newer Internet players like Facebook, but Yahoo remains a formidable destination, with its news site along attracting 81.2 million unique visitors in August. This point definitely would go in the ‘BUY IT’ option, when the board segregates the plus and the minus of buying Yahoo.
Talking about the non-disclosure pact, having both the parties signed it, Microsoft gets an opportunity to have a closer look at Yahoo’s books. If Microsoft does not takeover Yahoo in the end, it might still be of help to other interested parties who show interest in buying Yahoo.
However, a growing number of parties have signed confidentiality pacts with Yahoo. This is a clear indication that there is dwindling resistance to certain requirements of the agreement, including one that prevents potential bidders from talking to each other.
Briefing about the software giant’s plans, it was known that Microsoft held talks with potential partners last month about a possible bid. Out of the many combinations, one noted that Microsoft would contribute billions of dollars in financing as part of a consortium led by Silver Lake and the Canadian Pension Plan Investment Board. Sources even stated that the said group would even borrow billions of dollars from banks.
There is more to the count of interested buyers, but the potential bidders are yet to sign non-disclosure agreements. It even includes the Alibaba Group, a Chinese e-commerce company that Yahoo has a 40% stake in, has been in talks with private equity firms about making its own bid.
Yahoo had even noted a couple of points earlier in this regard, which included Yahoo ringing warning bells and had started working on the working of their financial information.
Earlier, Yahoo’s sellout news had spread like fire.
Microsoft seems to be copying Google’s tactics, which the search engine giant has opted for its social networking site. Microsoft even seems to be leaving no stone unturned to expand its base to popularize its Windows Phone and have a possible chance to give its competitors a tough competition.