Microsoft Raising Yahoo’s Bid

Posted on February 6, 2008
Filed Under Internet, Microsoft, Yahoo |

LOS ANGELES (Reuters) - Sceptical investors are trading Yahoo (YHOO.O: Quote, Profile, Research) shares at a 6.5 percent discount to Microsoft’s (MSFT.O: Quote, Profile, Research) unofficial offer price, but some Wall Streeters expect the software giant to raise its bid.

UBS on Tuesday set a price target for Yahoo shares above Microsoft’s $31 offer and Citi said a raised Microsoft bid was the most likely of five scenarios it saw for the unfolding drama between the world’s largest software company and the ailing Internet star.

Yahoo shares closed on Tuesday at $28.98, more than $2 per share below the $31 price Microsoft offered last week. Microsoft shares have dropped about 12 percent since that offer was made, potentially cutting the value of the half cash, half stock offer.

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