Yahoo paints profitable future to back Microsoft rejection
Yahoo predicts boom times ahead for the struggling Internet company in a three-year financial and strategic plan that its board of directors factored into its decision to reject Microsoft's cash-and-stock bid in February.
The California Internet pioneer expects operating cash flow to double in the next three years while revenues soar 70%.
Board members said the US software giant's offer of $31 per share of stock significantly undervalues Yahoo, which they believe is worth at least $40 per share.
It would cost Microsoft more than $10 billion to meet the higher price.
Yahoo released the financial plan this week as word spread that Microsoft executives have met with counterparts at the California firm to discuss the takeover offer.
"Yahoo is positioned for accelerated financial growth – we have a powerful consumer brand, a huge global audience and a highly profitable operating model," Yahoo chief executive Jerry Yang said in a statement.
"Yahoo is poised to capture growth in display advertising where we believe growth will be greatest."
Microsoft is continuing its quest to buy Yahoo and is said to be planning to oust Yahoo's board of directors at coming elections and replace them with candidates amenable to the takeover.
A key moment for Yahoo will be on April 22, when it announces its first-quarter earnings. Microsoft, investors and analysts will be watching whether Yahoo's vision of better financial times is coming true.
Loading ...