After yet another Microsoft statement of disinterest, Yahoo stock down 15 percent

November 7, 2008 | Eric Eldon | Comments |

No surprises here. Yahoo stockholders wanted Microsoft to buy the beleaguered yet large and profitable web company — or nothing — judging by Yahoo’s stock price today. The 15 percent drop so far today is apparently due to statements Microsoft chief executive Steve Ballmer made in Australia last night.

Ballmer said no acquisition is under consideration, only that his company is still open to a search deal with Yahoo, maybe. Such a deal will likely be worth far less than the now-defunct Yahoo-Google search partnership, given Google’s dominance in the search industry.

This is the latest non-news about Yahoo that stock traders are reacting to; chief executive Jerry Yang had said on Wednesday that his company wasn’t talking to Microsoft.

Nevertheless, Yahoo’s stock has been on a roller-coaster because of all this deal-making. Shortly after the Google deal’s death was announced Tuesday, a rumor spread among New York hedge funds that a Microsoft acquisition was imminent, and Yahoo’s stock jumped in the early hours of trading Wednesday. The rumor was fabricated by traders aiming to short the stock and make a quick profit, as we guessed upon hearing it.

[Screenshot via Google Finance]

Next Story: Roundup: Windows 7 to ruin Christmas, Craigslist cleans up, Pandora’s troubles and more
Previous Story: Here are the 2008 California Cleantech Open winners

Bookmark and Share

Tags: , ,

Photo of Eric Eldon

About the Author, Eric Eldon

Eric currently covers digital media technology and business news, especially what's happening on social networks and their platforms. He also writes and edits stories about venture capital, and lots of other stuff, too. He started at VentureBeat in the spring of 2007, half a year or so after Matt Marshall left his reporting job at the San Jose Mercury News to found the site. Eric previously cofounded a startup called Writewith, that was building editorial software for newspapers and other groups of writers. The startup didn't work out, but he learned a lot.

  • Ouch. I'm thinking that Microsoft is still interested, but they see a chance to let Yahoo twist in the wind for a little bit before they can sweep in with a single-digital per share price acquisition. Since Google is dropping talks over cooperation, Yahoo seems to be running out of options for monetizing their traffic.

    Nothing better than acquiring a competitor when they're under extreme stress...