Shocking the search industry, Microsoft has officially submitted it’s bid to acquire the search and internet giant Yahoo! for a stunning 44.5 Billion USD. I do say , a shocking news, but many would easily say that such a bid was forthcoming, following Yahoo!’s recent downfall in share prices, clubbed with its sacking of near 1000 employees. Openly inviting the press in a conference call, the software giant’s CEO Steve Balmer spoke to Jerry Yang and the board of directors of the most popular website / portal of the world and express their interest in furthering the expansion and synergis-ing their resources and efforts to counter the search #1 , the big G.

Microsoft has proposed to Yahoo’s Board Of Directors that Microsoft acquire all Yahoo shares for $31, which is currently estimated to be worth $44.6 billion. Yahoo shareholders would get either cash or Microsoft shares (0.9509 of shares per 1 Yahoo share)

As a follow up , Yahoo! inc. accepted :

Yahoo! Inc. (Nasdaq:YHOO), a leading global Internet company, today said that it has received an unsolicited proposal from Microsoft to acquire the Company. The Company said that its Board of Directors will evaluate this proposal carefully and promptly in the context of Yahoo!’s strategic plans and pursue the best course of action to maximize long-term value for shareholders.

This would probably be too early to analyze what this means, what the repercussions would be on the search industry along with the internet / web in general. However, it would not be out of place to mention a few points i can think of :

This is not the first time MS has submitted a bid to acquire Yahoo! , the last time they did was in previous year almost 10-11 months back, when Yahoo! board of directors openly refused saying , it was no time for such offers.
Even with the current low Yahoo has hit , Yahoo.com is still the website with highest traffic in all internet – in every metrics available on the internet, and Yahoo! also has several important acquisitions which fare highly in the current social web – namely, Del.icio.us , Yahoo Answers, Alibaba, Flickr , Facebook to mention a few. Yahoo email, Yahoo finance rates pretty highly on the radar of very many users , ranking over Gmail and similar applications.

On the other hand , Yahoo! has lost lots of ground on the search front , where Google has grown by leaps and bounds and truly a synergy of Yahoo and MSN could be the only force which might even come close. Microsoft on the other hand might gain a good deal by coming close with the Yahoo Publisher Network users and advertisers – which does have a sufficient base and development.

My personal feeling : I always liked Yahoo as a site , as a brand ( which Microsoft does as well, as Steve Balmer said in his note – intelligent minds think alike ), and a place to be. Google never had that and even less in Microsoft . As a person who has been on the net since 1997, i somehow would not feel impressed by a MSFT-YHOO clubbing. But then , it might be in the best of interest of the shareholders of Yahoo – What do you think ?

Tags: conference call, google, microsoft, redmont, steve balmer, yahoo, yahoo acquistion offer