Yahoo!, Inc. (YHOO)

valunvesthere (56.22) Submitted: 5/13/08 11:09 PM

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Hello hondo928,

The acquistion will be done down the road, not at $31.00/share and not at $41.00 plus/share. It'll be some where between $36.00 & $39.00.

Splitting the difference:

41 minus 31 equals 10
10 multipy 1/2 equals 10/2 equals 5
31 plus 5 equals $36.00

Purchasing Yahoo at 20% discount of difference:

41 minus 31 equals 10
10 muliply 4/5 equals 40/5 equals 8
31 plus 8 equals $39.00

The only thing that's preventing this deal from going through is how far apart Microsoft values Yahoo and real value of Yahoo. It's fair to say in between $36.00 & $39.00, but me personally $39.00 plus/share.

ANY-HOW,

Deal or no Deal, Yahoo is still the #2 web search engine.

The last time I've checked

#1 Google
#2 Yahoo
#3 Baidu
#4 MSN
#5 NHN
#6 eBay
#7 Time Warner (including AOL)
#8 ASK.com and related
#9 Yandex
#10 Alibaba.com

Finally, there's more than one fish in the ocean! I personally would like to see some sort of alliance of Yahoo, Baidu, Time Warner (includes AOL), and Alibaba.

From Valunvesthere.

P.S. #2 Yahoo's got more negotiation room than #4 Microsoft!!!

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hondo928 (99.83) Submitted: 5/14/08 12:07 AM

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Microsoft has almost enough cash to buy Yahoo out that equals negotiation room...I don't think they should make the deal, personally I will be very tempted to short Microsoft, if they make this deal at 36. Also the fact that Balmer made an offer a year ago, (which I assume was much higher than 31 a share since the stock was already at 28) makes me believe you that the offer could get sweet. I'm really just not a fan of Yahoo management, and second best isn't always good. I think maybe Yahoo should look into acquistions of their own, like say of ask or Alibaba. Yang needs to seperate himself from the deal completley and increase shareholder value. Microsoft has him in a chokehold right now, 31.10 he may have to take.

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valunvesthere (56.22) Submitted: 5/14/08 1:23 AM

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Hello hondo928,

Acquiring Ask and Alibaba will not bump MSN to #2 Yahoo spot and not even #3 Baidu spot. It'll hardly increase any MSN market share of the search engine pie. If that wasn't the case Steve Ballmer would've acquired them long time ago!!!

Yes, Microsoft is flush with cash and needs to address in improving MSN. The toughest decision is how he's going to spend that cash conservatively with maximum results in improvements to MSN. He's making us believe Microsoft can only afford $33.00/share and there cash account will be almost 0, any more they'll be borrowing to acquiring Yahoo.

Finally, I don't believe Steve because with negative fan-fare launch of Windows VISTA . Microsoft still made alot of money because computer manufacturers purchased and pre-installed Windows Vista months before the release date in early 2007. X-Box game console, X-Box games, and X-Box accessories is generating cash flow. Microsoft software and computer hardware accessories is also generating cash flow. Even if Steve paid $41.00 plus/share (Jerry's asking price,which is very fair) I'm sure Microsoft can make that money back and than some in a few months .

From Valunvesthere.

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hondo928 (99.83) Submitted: 5/14/08 10:24 PM

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$41 a share????? Is reasonable 54 times trailing earnings and 79x Forward Earnings on a zero growth company that's outrageous. Not to mention the PEG of 4.5 it would be sporting, after the fees and everything and costs of acquiring the company were done. I don't care if they can make the money or not unless this is 1999 that should in no way happen. And if it does the MSFT stock holder should sue their company for being stupid. I think MSFT has come out and said that they would finance the deal to give the banks business anyway. Personally I think 33 a share is very very nice offer, for a stock that was trading at $20 a share...Microsoft should have made a creeping tender offer, to make sure this deal went through if they wanted it at 33

And sorry if you misunderstood me earlier I was saying Yahoo should try and buy out Alibaba or some similar company, it would increase debt on their books and deter a takeover...partiuclarly if they pay a huge premium, if they wanted to really deter it agree to terms of debt at a high interest rate, or the other option would be some sort of pacman defense, which would increase the suggested possibility of Microsoft Shareholders being the White Knight in the deal.

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