Microsoft won't pursue other partnerships, says Gates

by Martyn Williams

May 7, 2008 —

Microsoft won't be pursuing tie-ups or takeovers to replace its failed Yahoo
bid, Bill Gates said in Tokyo on Wednesday.

Gates, who cofounded the software maker and serves as its chairman, said Microsoft
had "put a lot of effort into talking to Yahoo."

Referencing comments made by Microsoft CEO Steve Ballmer, Gates said that "now
at this point, Microsoft is focused on its independent strategy."

Microsoft spent three months courting Yahoo but dropped
its pursuit on Saturday after the two sides failed to reach agreement on
a takeover price. Microsoft had initially offered US$31 per share and raised
it to US$33 per share to try and entice Yahoo but the search engine operator
held out for $37 per share.

After final negotiations late last week Ballmer
signaled to Yahoo CEO Jerry Yang that it was throwing in the towel.

"We continue to believe that our proposed acquisition made sense for Microsoft,
Yahoo and the market as a whole. Our goal in pursuing a combination with Yahoo
was to provide greater choice and innovation in the marketplace and create real
value for our respective stockholders and employees," said Microsoft CEO
Steve Ballmer in a statement distributed early Saturday evening.

On Monday Yang, facing pressure
from shareholders, signaled that Yahoo is still
open to an offer from Microsoft or another company as long as the company
is not "undervalued."

"We've always felt the Yahoo platform has been undervalued or underappreciated
by the marketplace,'' he told Bloomberg News.

Gates was speaking in Tokyo and announced two programs from Microsoft Japan.
One promotes Windows Media Center and the other will provide Microsoft's software
development tools at no charge to student developers.

IDG News Service