On January 31, 2008, Microsoft CEO Steve Balmer wrote a letter to YAHOO seeking to acquire the company at a 62% premium above that day’s closing stock price. Yahoo’s board, led by CEO Jerry Yang, unanimously declined this first offer—prompting Microsoft to make several subsequent attempts to close a deal. This case outlines the negotiating process over a three-year period between Microsoft and Yahoo, asking student to analyze whether Microsoft’s offering prices were in line with Yahoo’s value.

Case id: 120309
Supplemental Material: Teaching Note