After 27th of October, when it is now known that Yahoo and Microsoft have not yet signed the deal, Yahoo has now admitted that it is purposefully delaying the deal with Microsoft because they have come to know about various things that were not disclosed earlier by Microsoft. Earlier, in July, Microsoft and Yahoo had agreed for a deal in which Yahoo Search would be driven by Microsoft’s new search engine Bing. In return, Yahoo agreed to flog search and take care of web advertising for both its own company and for Bing as well.
Based on this prospective discussion, both the companies said that they would have the deal finalized and agree on the final terms by 27th of October. However, according to a filing that has been submitted by Yahoo with the US Securities and Exchange Commission, the deal has not yet been signed and there seems to be some serious commotion. In the filing that has been submitted by Yahoo, they have said, “Given the complex nature of the transaction, there remain some details to be finalised”. Resources have revealed that both the companies (Yahoo and Microsoft) are carefully working out the final terms of the agreement and in order to buy some time they have postponed the final dates. However, the postponed dates have not been revealed but they have just said that they would execute the agreements as early as possible. As the answer that has been given by the companies as not very convincing, it is not sure on how the deal would take place.
Resources, by their views, have said that the reason for the delay might have probably arisen from the terms of the agreement that talks about the 10 years commitment between both the companies. In this deal, after Yahoo and Microsoft receive the regulatory approval for the deal in the U.S, they might also have to get the approval from European regulators as well. However, it is not sure on how long it would take European regulators to start working on this deal as it very much depends on how soon they approve the proposed acquisition of Sun Microsystems by Oracle. All these complexities make sure that the deal between Yahoo and Microsoft is going to take a longer time and not in the next few months.
Yahoo, in its statement about the delay has specified as follows, “Given the complex nature of this transaction there remain some issues that need some additional clarity and definitive details. Both companies are optimistic that we will be able to close this deal by early 2010.” However, Microsoft has denied to immediately responding to any of the questions that were raised. Though Yahoo has specified about the optimistic approach of both the companies, it does not seem like there is really any pleasant situation over there.
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