Yahoo Inc. has rejected Microsoft's latest attempt to buy its online search operations in a “take or leave it” proposal that Yahoo said would have dismantled its Internet franchise.
As described by Yahoo in a statement late Saturday, Microsoft packaged its offer with activist investor Carl Icahn, a billionaire who is seeking to overthrow Yahoo's board of directors in a shareholder meeting scheduled for Aug. 1.
Without providing many specifics, Yahoo said Microsoft renewed an earlier bid to buy the company's search engine and proposed turning over the remaining pieces to a board controlled by Icahn.
Yahoo said it received the proposal Friday and was given less than 24 hours to respond.
Backed into a corner, Yahoo lashed out in a blunt manner likely to inject even more bad blood into its already venomous relationship with Microsoft and Icahn.
“It is ludicrous to think that our board could accept such a proposal,” Yahoo Chairman Roy Bostock said. “While this type of erratic and unpredictable behavior is consistent with what we have come to expect from Microsoft, we will not be bludgeoned into a transaction that is not in the best interests of our stockholders.”
In another indication of the animosity between the two companies, Bostock said Microsoft has taken the “completely absurd and irresponsible” stance of refusing to hold any further talks with Yahoo's current leadership.
Microsoft did not respond to a request for comment late Saturday. Efforts to reach Icahn were unsuccessful.
Yahoo said the proposal that Microsoft submitted Friday “contains a number of improvements,” but insisted it still wasn't good enough.
Icahn, who has been challenging corporate boards for more than two decades, owns a roughly 5 percent stake in Yahoo and hopes to make a profit by pushing the company's stock price above $30.