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business newsMicrosoft and Yahoo: Marriage of Convenience?
With both companies struggling, time to revisit merger.
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But what I don’t hear a lot of discussion about is whether or not this makes some sort of combination with Yahoo (YHOO) more or less likely. And frankly, I’m surprised.
Yeah, I know: CEO Steve Ballmer nixed the idea of wedded bliss. But what I don’t think he understands is that he doesn’t run the company single-handed - its shareholders are the ultimate arbiter. Am I being idealistic? Perhaps. But given the fact that the stock now trades at multi-year lows, I think shareholders are anxious for something big to happen to get the company out of this rut.
This -- in combination with the fact that Jerry Yang is out of the picture, and Carol Bartz (whom I almost always inadvertently call Bratz), is in the CEO spot -- seems to make a deal more likely. And her stock would certainly rise if she could open a dialogue.
Then there’s Mr. Icahn. With Yahoo’s stock in the tank and Icahn (and his entities) long some 50 million+ shares as of September 30th, I think he’s got to be chomping at the bit for a deal.
The potential stick in the eye, however, could be in the form of Bartz’s reported pay package: She'll reportedly receive "$1 million in base pay; an annual bonus that could exceed $4 million depending on performance; 5 million, 7-year options; annual equity grants (her 2009 grant will be worth $8 million; a $150,000 grant to cover advisory fees connected to her employment contract; and a $10 million equity grant."
In short, it seems like a pretty sweet gig - if she stays on board.
The bottom line: I think it’s just a matter of time until the desire for change on both sides causes the 2 to come together. Never say never.
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