Microsoft wants to buy Yahoo! for $44.6 Billion

Microsoft has made an official proposal to acquire Yahoo! for the sum of $44.6 Billion in cash and stock at a price of $31 per share which represents a 62 percent premium for shareholders.

Here’s a quote from the official Microsoft press release :

Microsoft Corp. (NASDAQ:MSFT) today announced that it has made a proposal to the Yahoo! Inc. (NASDAQ:YHOO) Board of Directors to acquire all the outstanding shares of Yahoo! common stock for per share consideration of $31 representing a total equity value of approximately $44.6 billion. Microsoft’s proposal would allow the Yahoo! shareholders to elect to receive cash or a fixed number of shares of Microsoft common stock, with the total consideration payable to Yahoo! shareholders consisting of one-half cash and one-half Microsoft common stock. The offer represents a 62 percent premium above the closing price of Yahoo! common stock on Jan. 31, 2008.

“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,” said Steve Ballmer, chief executive officer of Microsoft.

The official press release from Yahoo! confirms the offer, though it doesn’t offer many details :

Yahoo! Inc. (Nasdaq:YHOO), a leading global Internet company, today said that it has received an unsolicited proposal from Microsoft to acquire the Company. The Company said that its Board of Directors 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.

This is not the first time Microsoft makes an offer to buy Yahoo! a similar offer was put on the table in May 2007. The motivation behind this seems to be obvious, a power-play against the rival Google, who, let’s face it is beating both companies (n.r Microsoft and Yahoo!) in multiple fields. If that is the fact or not we’ll find out in time.