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Microsoft Could Get Hostile With Yahoo Today

Microsoft could begin the process of a hostile takeover of Yahoo as soon as today as Steve Ballmer told Microsoft employees Thursday that "We ought to announce something in relatively short order."

Speaking to a gathering of Microsoft employees Ballmer said “I know exactly what I think Yahoo is worth to me. I won’t go a dime above, and I will go to what I think it’s worth if that gets the deal done." This comes as reports of people close to the deal said that Microsoft is considering raising its offer from $29.48 per share (as it currently stands) to $33 to entice Yahoo’s shareholders once and for all.

Yahoo’s board has not cooperated with Microsoft, and now the company will have to get hostile in order to take over the company. A $33 offer could tip the scales, as Yahoo shareholders know that it’s the best offer they’ll get and it would line a lot of pockets considerably.

Ballmer has been following a carrot-and-stick approach to goad the Yahoo shareholders into accepting the deal: On the one hand offering to raise the price, and on the other repeatedly making it clear that Microsoft would be willing to walk away from the deal and go it alone if they hold out for too long. It’s now a question of who blinks first.

Meanwhile, Yahoo management is set to go ahead with a partnership with Google that would see its search results peppered with Google’s ads. This partnership was established in an attempt to bolster Yahoo’s position against Microsoft, and in the process proving that Yahoo’s management has been less than successful in pursuing Yahoo’s own contextual ad business. The company is also considering a merger with AOL in order to bolster its web content business.