Microsoft has given Yahoo’s board of directors a time limit of three weeks to agree to its proposed $44.6 billion takeover.
If Yahoo management continue to hold out for a higher offer, Microsoft have threatened to take the deal directly to Yahoo shareholders.
Although the proposed deal has been rejected by Yahoo management team for undervaluing the company, Microsoft has stood firm and refused to up the offer - which Microsoft CEO Steve Ballmer has described as “fair”.
Should the takeover attempt become a proxy fight for control of the company, the leadership of Yahoo are likely to be at risk of losing their seats on the board.
“If we have not concluded an agreement within the next three weeks, we will be compelled to take our case directly to your shareholders, including the initiation of a proxy contest to elect an alternative slate of directors for the Yahoo board,” said Ballmer in a statement released on Saturday.
The pressure is now growing on Yahoo, after attempts to spark interest from other potential suitors has apparently failed, with investors such as News Corp. and Time Warner being ruled out. With the prospect of a hostile takeover now firmly on the cards, Yahoo’s shareholders could turn up the pressure on the board to sit down at the negotiating table with Microsoft.
According to Reuters, Yahoo are not opposed to a deal with Microsoft in principle, but feel they should pay more than the current $31 a share offer.