Mr. Jerry Yang
CEO and Chief Yahoo
701 First Avenue
Sunnyvale, CA 94089
After over three months, we have reached the conclusion of the process regarding a possible combination of Microsoft and Yahoo!.
I first want to convey my personal thanks to you, your management team, and Yahoo!』s Board of Directors for your consideration of our proposal. I appreciate the time and attention all of you have given to this matter, and I especially appreciate the time that you have invested personally. I feel that our discussions this week have been particularly useful, providing me for the first time with real clarity on what is and is not possible.
I am disappointed that Yahoo! has not moved towards accepting our offer. I first called you with our offer on January 31 because I believed that a combination of our two companies would have created real value for our respective shareholders and would have provided consumers, publishers, and advertisers with greater innovation and choice in the marketplace. Our decision to offer a 62 percent premium at that time reflected the strength of these convictions.
In our conversations this week, we conveyed our willingness to raise our offer to $33.00 per share, reflecting again our belief in this collective opportunity. This increase would have added approximately another $5 billion of value to your shareholders, compared to the current value of our initial offer. It also would have reflected a premium of over 70 percent compared to the price at which your stock closed on January 31. Yet it has proven insufficient, as your final position insisted on Microsoft paying yet another $5 billion or more, or at least another $4 per share above our $33.00 offer.
Also, after giving this week's conversations further thought, it is clear to me that it is not sensible for Microsoft to take our offer directly to your shareholders. This approach would necessarily involve a protracted proxy contest and eventually an exchange offer. Our discussions with you have led us to conclude that, in the interim, you would take steps that would make Yahoo! undesirable as an acquisition for Microsoft.
We regard with particular concern your apparent planning to respond to a 「hostile」 bid by pursuing a new arrangement that would involve or lead to the outsourcing to Google of key paid Internet search terms offered by Yahoo! today. In our view, such an arrangement with the dominant search provider would make an acquisition of Yahoo! undesirable to us for a number of reasons:
•First, it would fundamentally undermine Yahoo!』s own strategy and long-term viability by encouraging advertisers to use Google as opposed to your Panama paid search system. This would also fragment your search advertising and display advertising strategies and the ecosystem surrounding them. This would undermine the reliance on your display advertising business to fuel future growth.
•Given this, it would impair Yahoo's ability to retain the talented engineers working on advertising systems that are important to our interest in a combination of our companies.
•In addition, it would raise a host of regulatory and legal problems that no acquirer, including Microsoft, would want to inherit. Among other things, this would consolidate market share with the already-dominant paid search provider in a manner that would reduce competition and choice in the marketplace.
•This would also effectively enable Google to set the prices for key search terms on both their and your search platforms and, in the process, raise prices charged to advertisers on Yahoo. In addition to whatever resulting legal problems, this seems unwise from a business perspective unless in fact one simply wishes to use this as a vehicle to exit the paid search business in favor of Google.
•It could foreclose any chance of a combination with any other search provider that is not already relying on Google's search services.
Accordingly, your apparent plan to pursue such an arrangement in the event of a proxy contest or exchange offer leads me to the firm decision not to pursue such a path. Instead, I hereby formally withdraw Microsoft's proposal to acquire Yahoo!.
We will move forward and will continue to innovate and grow our business at Microsoft with the talented team we have in place and potentially through strategic transactions with other business partners.
I still believe even today that our offer remains the only alternative put forward that provides your stockholders full and fair value for their shares. By failing to reach an agreement with us, you and your stockholders have left significant value on the table.
But clearly a deal is not to be.
Thank you again for the time we have spent together discussing this.
Steven A. Ballmer
Chief Executive Officer
對於雅虎不願接受微軟收購請求一事，我個人倍感很沮喪。我於今年1月31日首先向你們提出了收購出價，原因是我相信，如果微軟與雅虎合併，不但符合我們兩 家公司各自股東的利益，而且有利於我們向消費者、內容出版商和網路廣告商提供更多技術創新和服務，從而使他們獲得更多服務選擇。我們最初出價比雅虎當時股 價溢價 62%，這已充分體現了我們的收購誠意。
在微軟和雅虎本週進行的會談中，我們已願意把出價(由原來每股31美元)提高到每股 33美元，這同樣充分體現我們的良好收購願望。通過這次提價，將使雅虎股東增加將近50億美元的價值。如果與雅虎1月31日的收盤價相比，我們每股33美 元的出價已經溢價70%以上。但我們每股33美元出價仍然無法滿足你們的要求，你們堅持要求我們再增加50億美元或更多，即在每股33美元基礎上再至少每 股增加4美元。
此外，在經過我們雙方本週舉行的會談後，我個人已感覺到，如果微軟今後直接向雅虎股東提出收購請求，這種作法已顯得很不明智。原因是如果我們向股東提出收 購請求，勢必會導致長時間的代理權爭奪戰，而最終還得涉及交換收購(註：exchange offer，即交易通過股票方式進行)。本週會談中你們的態度使我們確信，在微軟髮起代理權爭奪戰期間，你們肯定會採取更積極的反收購措施，從而微軟收購 雅虎的實質意義大為降低。