Yahoo! rejects Microsoft takeover offer

Back to the internet everybody, and Yahoo! Inc has formally rejected that much reported unsolicited takeover offer from Microsoft. As previously reported, Microsoft offered over $40 billion for the web firm, part of its efforts to reassert itself in a Google/Apple dominated internet. Microsoft is now expected to make a fresh bid with a higher offer price. In his internal memo confirming he was rejecting Microsoft's original takeover offer, Yahoo! Inc boss Jerry Yang said: "We believe Microsoft's proposal substantially undervalues Yahoo!", though he didn't indicate what he considered to be a fair price. Of course, Microsoft could go straight to Yahoo!'s bigger investors and attempt a hostile takeover or rethink its ambitions to acquire the firm - though those who know about these things seem to think an increased offer to the Yahoo! board is the most likely next step. The Yahoo! Chief has let it be known he is considering various options for safeguarding his company's future - an alliance with Google is thought to be one, while the Times has reported that some sort of deal with AOL may be another.