CARLSBAD, May 29 – Yahoo chief executive Jerry Yang said Wednesday that Microsoft is "no longer interested" in buying the pioneering Internet firm, but is considering "other partnerships."
Yang also maintained that Yahoo is "not under siege" despite a threatened stockholder revolt led by billionaire corporate raider Carl Icahn.
Yang\’s comments came during a speech at an "All Things Digital" conference organized by the Wall Street Journal in the Southern California city of Carlsbad.
"Microsoft is no longer interested in buying the company and they are discussing various other partnerships with us," Yang said, echoing comments made the prior evening by Microsoft chief executive Steve Ballmer.
"We are listening."
Yang implied that sparring that took place between the companies while Microsoft\’s nearly 50 billion dollar offer was on the table has given way to talks aimed at finding a way for them to work together.
Microsoft could have taken a "much more hostile" tact and tried to oust the Yahoo board of directors that rebuffed advances by the Redmond, Washington, based software giant, according to Yang.
Yang stressed that it was Microsoft, not Yahoo, which walked away from the bargaining table.
Microsoft says it broke off takeover talks in late April after it upped its February 1 bid of 44.6 billion dollars by three billion dollars and Yahoo\’s board still wanted more.
Yang defended the board\’s handling of failed takeover talks with Microsoft and pleaded anew the case that the struggling Internet firm is poised to recapture its former glory and a bigger share of online advertising dollars.
Microsoft wanted to buy Yahoo to better take on Google, which dominates the lucrative world of Internet search and advertising.
"They definitely have an interest in Yahoo," Yang said of Microsoft. "With the right circumstances, not only price, our board is open."
Talks between Yahoo and Microsoft may be centered on letting Microsoft handle Yahoo\’s online advertising in the belief it can pump more cash out of the promising revenue source.
Yahoo successfully tested just such an arrangement with Google during Microsoft\’s takeover try.
An alliance with Microsoft, or even Google, could be a salvation for Yahoo board members facing a showdown with Icahn.
Icahn has reportedly bought a stake of more than four percent in the California firm and says he plans to oust board members he accuses of botching takeover talks with Microsoft.
Icahn has nominated a Microsoft-friendly slate, which includes him, to replace all ten Yahoo board members at elections to be held at an annual meeting in late July.
Yahoo delayed the shareholders meeting to an unspecified date because it needs time to prepare for the threatened coup attempt.
"The perception of us being a company under siege is just not accurate," Yang said as he was peppered with questions about Yahoo\’s future.
Yahoo\’s potential to make money online stretches far beyond search, according to company president Susan Decker.
Internet search accounts for only 10 percent of the space for placing online advertising, and Yahoo boasts 500 million people that routinely use its properties, which include free email and user groups.
"It\’s an enormous asset," Decker said at the conference. "It\’s undervalued. We want to do more with it."