Most of Yahoo Inc’s top institutional shareholders may be more interested in making sure Microsoft Corp does not overpay for the Web pioneer, because they have more money invested in the bigger software maker.
Financial risk management analysis company RiskMetrics Group found that close to 90 percent of Yahoo’s institutional shareholders have a cross-holding in Microsoft, including most of the top 20 — and generally have significantly more money invested in Microsoft.
Microsoft has offered to buy Yahoo for $31 a share in cash and stock, a bid which Yahoo’s board rejected, saying it undervalued the company.Microsoft countered by saying that its offer was “full and fair,” but did not say what it planned to do next.It may sweeten it’s bid upto $35 a share.
A shareholder that owns both the target and an acquirer will be more interested in the net benefit of a deal, RiskMetrics said. Shareholders with more money invested in Microsoft than Yahoo will most likely urge Yahoo not to push its case too hard.