"Sources close to the Microsoft-Yahoo! deal talks, as well as some Yahoo! shareholders, believe Ballmer is intentionally making offers that he knows Yahoo! will reject - and using Carl Icahn to do it - as part of his longer-term plan to either buy Yahoo! on the cheap or permanently hobble it as a competitor. "
I'm not buying the part about hobbling Yahoo as a competitor. In terms of search and advertising, the only competitor that Microsoft cares about is Google. Plus, Yahoo has been limping pretty badly for a while.
Is it in Ballmer's best interest to paint Yahoo management and Board as intransigent on not shareholder-friendly? Of course.
I actually don't think Ballmer has done a bad job to date on the Yahoo deal, other than not pushing ahead more quickly when it looked like he had a window to get the deal done. Now, whether the current back-and-forth is designed to sweeten the terms, it looks like the result for Microsoft will be the same. Game over.
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