Microsoft’s chief executive has warned the Yahoo board on Saturday that if a merger was not completed in the next three weeks, it will offer the deal directly to its shareholders, at a lower price.
The warning, from an e-mail acquired by TechCrunch, also says that without an agreement that it would seek to oust the current directors.
“If we have not concluded an agreement within the next three weeks, we will be compelled to take our case directly to your shareholders, including the initiation of a proxy contest to elect an alternative slate of directors for the Yahoo! board,” Steve Ballmer wrote.
“If we are forced to take an offer directly to your shareholders, that action will have an undesirable impact on the value of your company from our perspective which will be reflected in the terms of our proposal.”
Yahoo declined to comment on the deadline.
The offer, which was announced on January 31, was a cash and stock offer worth $44.6 billion – or $31 a share. According to the NY Times, it is now worth about $42 billion. The company rejected the offer and said the offer “substantially undervalues” the company.
However, Microsoft described the offer as generous; as the deal on each share was a 62% premium over Yahoo’s closing price on Jan. 31. It has refused to raise it.
Yahoo is talking to AOL and News Corporation for a potential alternative to fend of the deal, though currently to no avail. Google is also backing Yahoo’s efforts to stop the deal getting the go ahead.