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Yahoo Dragging On Microsoft Shares

It's not just Microsoft employees who are worried about the possible ramifications of a Yahoo union. The Yahoo bid has single-handedly dragged down Microsoft's stock. The software giant has seen shares fall 3.5% since CEO Steve Ballmer's $44.6 billion offer to buy the company on Jan. 31. Ken Smith, director of technology investment at Munder Capital Management says Yahoo's repeated rejections have shifted investor attention away from Microsoft's strengths. "They need to quit fooling around and get the deal done," Smith said, adding that "the fundamentals of Microsoft's business are tremendous, but this has really capped the stock."

As much as all and sundry would like to see the deal get done, Microsoft is standing firm on its offer and its deadline of this Saturday for it to be accepted before taking the matter directly to shareholders in a proxy fight.

Given that the deal would take about a year to clear anyway, fund manager David Stepherson, who manages about $700 million, thinks it's already too late for the Redmond, Wash. giant. "Microsoft in a lot of ways has sort of botched this,'' he said. "Everything with them is too slow. Now, they've lost the momentum.''

Read the whole story at Bloomberg News »

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