Microsoft’s Yahoo Bid 'Ridiculous'

Investment manager dismisses deal, doubts Ballmer's acumen
By Laila Weir,  Newser Staff
Posted Feb 18, 2008 2:40 PM CST
Microsoft’s Yahoo Bid 'Ridiculous'
Microsoft CEO Steve Ballmer smiles during a talk at the Web 2.0 conference in San Francisco, Thursday, Oct. 18, 2007. Microsoft Corp. said Thursday, Oct. 25, 2007, its fiscal first-quarter profit rose 23 percent as brisk sales of the new "Halo 3" video game, Windows and Office helped the software maker...   (Associated Press)

Investment manager Joe Rosenberg takes a swipe at Microsoft's bid for Yahoo in this week's Barron's, disparaging both the deal and CEO Steve Ballmer's financial acumen, Reuters reports. "It's a bad reflection on Ballmer that he's willing to pay a ridiculous price for Yahoo,” says Rosenberg. “Microsoft is not going to earn anything like a reasonable rate of return in Yahoo." An increased bid, which Yahoo is seeking, would be even worse, he says.

The market seems to agree: Microsoft's stock dropped four points since its bid, closing at $28.42 Friday. That value destruction nearly equals Microsoft’s offer for Yahoo, Rosenberg notes, warning that Ballmer should be nurturing his stock’s value to avoid losing employees tired of underperforming shares. "The best thing of all would be if Microsoft drops the bid," he adds. (More Microsoft stories.)

Get the news faster.
Tap to install our app.
X
Install the Newser News app
in two easy steps:
1. Tap in your navigation bar.
2. Tap to Add to Home Screen.

X