Microsoft’s Attempt to Acquire Yahoo: A Case in Letters

Should Yahoo have accepted Microsoft’s 2008 acquisition offer?
Wei Jiang  | Winter 2012
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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 Materials: Teaching Note

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