After meeting with everyone on earth who might possibly provide a Microsoft (MSFT) escape hatch, Yahoo (YHOO) finally deigned to meet with the hated Redmondites themselves. The spin? Just an informal chat. No bankers, no negotiations, no commitments.
Microsoft did make one thing clear, though: Microsoft won’t even consider raising its bid until it “gets a close look at Yahoo’s books,” the WSJ says. Translation? Same as it ever was: Come to the table for real and we’ll talk.
It’s possible that Yahoo agreed to this meeting just to cover its posterior (hard to defend lawsuits alleging that you’re breaching fiduciary duty when you won’t even meet with the company offering you the best deal). More likely, however, the meeting represents a thawing of the Yahoo-Microsoft ice. For the sake of both companies, we hope it soon leads to more formal negotiations.
Time is working against both companies here: As the economy deteriorates, the outlook for Yahoo’s near-term performance gets worse, and the worse Yahoo’s performance gets, the more leverage Microsoft has. At Microsoft, meanwhile, the deal purgatory is likely causing anxiety within the Internet division, as executives wonder which “redundancies” will be eliminated.
See Also: Yahoo Disaster Scenario: Blowing Q1
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