Yahoo Deal Is "A Thing Of The Past" - MS

The mooted acquisition of Yahoo Inc. (YHOO) by Microsoft Corp. (MSFT) is "a thing of the past," Microsoft Chief Executive Steve Ballmer said in an interview due to air Thursday.

Ballmer's remarks, in an interview with Fox Business Network, appear to pour cold water on recent reports that the bid, which Microsoft pulled last year after months of fruitless talks, had been revived.

"You certainly shouldn't think we'll go back after Yahoo," Ballmer told interviewer Brian Sullivan. We may try to do other kinds of partnerships with them, but acquisition is a thing of the past."

Speaking in Las Vegas, where he unveiled a preliminary version of the next Windows operating system, Ballmer said that the information-technology industry was going through a rough time, and that he expected consumers and businesses to buy less technology. But although he said maintaining Microsoft's cash reserves was a priority, he declined to comment on recent reports Microsoft may be forced to cut jobs.

"In this environment I think it's fair to say cash is king. We are glad we have cash. We're going to continue to hold good cash reserves."

Microsoft had cash and cash equivalents of $20.7 billion as of Sept. 30.

Ballmer's remarks follow a recent bout of speculation suggesting that a group of Silicon Valley executives and investment bankers was trying to revive the deal with a new structure. Both Microsoft and Yahoo declined to comment on the reports.

An Internet blog report Wednesday suggested the group wanted to put together a deal which would be financed largely by debt supplied by Microsoft.

Microsoft offered around $47.5 billion in cash and shares to acquire Internet portal Yahoo early in 2008 in order to beef up its presence in the Internet advertising market, but the two parties were unable to agree on price, and Microsoft eventually walked away.

Since the deal collapsed, and amid lobbying from Yahoo shareholders for the deal to be revived, Ballmer has consistently said he has no interest in revisiting an acquisition for Yahoo, but more recently has indicated that he may be open to a partnership based on Yahoo's Internet search assets.