Yahoo received a tepid endorsement from its second-largest shareholder yesterday as its takeover battle with suitor Microsoft continued to heat up, the Wall Street Journal reports. Legg Mason, which holds a 7% stake in Yahoo, said it would back an independent Yahoo before it would sell its stake at a reduced price—and Microsoft's CEO "blundered" by threatening to go that route.
Steve Ballmer told Yahoo’s board it would launch a proxy battle and likely lower its price if Yahoo didn’t agree to a deal within three weeks. Yahoo called the ultimatum "counterproductive;" Legg portfolio manager Bill Miller said if Microsoft ups its offer “the pressure shifts very quickly to Yahoo to negotiate.” (More Yahoo stories.)