• DealBook/Silicon Alley Insider, Thursday, July 10, 2008 11:45 AM

The New York Times' Andrew Ross Sorkin, on the prowl at the Allen & Co. media mogul confab in Sun Valley, writes on his DealBook blog that Carl Icahn, the corporate raider who aims to take down the Yahoo board and then sell the company to Microsoft, is prepared to sell for even less than the $33 per share Microsoft offered during negotiations this spring. "He just needs a number that starts with a three," one mogul said of Icahn, who threw down roughly $25 a share for his stake in Yahoo.

Well, good luck with that, says Silicon Alley Insider's Henry Blodget. Microsoft may be cash rich and desperate to acquire Yahoo's search business, but a lot has happened in the 10 weeks since that $33 per share offer. First off, Microsoft's stock has dropped more than 20% since making its original offer for Yahoo on Feb. 1, wiping away more than $65 billion from the company's market cap. This is about twice what Yahoo costs. If all things were equal (which they aren't), Microsoft's next offer for Yahoo should be 20% lower than the original $31 per share.

Moreover, Yahoo is in a real bind. Nobody else wants to buy the company; all it got for months of trying to find a rival bidder was a lousy search deal with Google, one that many think diminishes Yahoo's value even further because it effectively takes the Web giant out of the search game. And finally, Blodget points out that the overall stock market is down 10% from Feb. 1, a fact which would make any stock-for-stock bid at least $3 per share lower than it would have been in February.

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