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Gates says Microsoft to pursue 'independent strategy'
Microsoft Corp. chairman Bill Gates said the world's biggest software company will pursue an "independent strategy" after Yahoo! Inc. (YHOO/Nasdaq) rejected its US$47.5-billion takeover bid.
"We put a lot of effort in talking with Yahoo and the conclusion was reached that we should pursue our independent paths," Mr. Gates said at a press conference in Tokyo Wednesday.
His comments reiterated those made by Microsoft chief executive Steve Ballmer in a statement after the Redmond, Wash.-based company withdrew its US$33 a share offer on May 3. Analysts at UBS AG, Oppenheimer & Co. and Merrill Lynch & Co. have since said Microsoft (MSFT/Nasdaq) may approach Yahoo again.
"I would stick to what he said. And he said that now at this point Microsoft is focused on its independent strategy," Mr. Gates told reporters.
Microsoft will continue to innovate and expand its business "with the talented team we have in place and potentially through strategic transactions," Mr. Ballmer said in his statement.
Microsoft rose US62 cents, or 2.1%, to US$29.70 in Nasdaq Stock Market trading on Wednesday. The shares had fallen 17% this year before Wednesday. Yahoo gained US$1.35, or 5.5%, to US$25.72 and had advanced 11% this year.
Mr. Ballmer had pursued a takeover of Sunnyvale, Calif.-based Yahoo to jumpstart Microsoft's money-losing Internet unit. The business posted a US$228-million loss last quarter and trails Google Inc. and Yahoo in the US$41-billion market for Internet advertising. Microsoft expects the market to almost double to US$80-billion by 2010.
Google Competition
Google gained 10 percentage points of market share in Internet queries since June and accounted for 59.8% of searches in March, according to Reston, Va.-based researcher ComScore Inc. Google outsold Microsoft in Internet ads by a margin of 7-to-1 in Microsoft's most recent fiscal year.
Buying Yahoo would have more than tripled its share of searches and stepped up competition with Google, which has grown faster than Microsoft in every quarter since Google's 2004 initial public offering. Still, Yahoo's inability to crack Mountain View, Calif.-based Google's dominance in search led to eight straight quarters of declining profit before Microsoft's bid.
While Yahoo isn't for sale, the company would listen "should somebody else come back someday and want to buy the company," CEO Jerry Yang said in an interview on Monday.
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