Microsoft Corp (MSFT.O) Chief Executive
Steve Ballmer said on Friday that buying (YHOO.O) was not
a strategy in itself, and dropping the bid meant it now had $50
billion to spend on other acquisitions.
"Yahoo was never the strategy we were pursuing, it was a
way to accelerate our online advertising business," he told a
packed hall at a technology conference in Moscow.
"We will spend money on some acquisitions. You can do a
whole lot of things with 50 billion dollars," he said.
Ballmer was responding to questions about what he planned
to do with Microsoft's huge cash pile after it walked away from
a proposal to buy Internet media company Yahoo for $47.5
billion, or $33 a share earlier this month. Yahoo had rebuffed
the offer, saying it would only settle for $37 per share.
Microsoft's top executive was echoing a refrain heard from
him in recent weeks: At a May 1 employee meeting, he said Yahoo
was valuable as part of a strategy to beat Microsoft arch-rival
(GOOG.O), but there were limits on the price it would
pay.
"Yahoo's not a strategy, it's a part of a strategy,"
Ballmer had said three weeks ago in Redmond, Washington.
"We're interested to pay for it (Yahoo) at some level and
beyond that level we're not willing to pay for it."
Talks broke down May 3 and Microsoft said it had "moved
on."
Early this week, the two companies said new talks were
underway on a more limited deal but neither side disclosed the
terms. A source familiar with the discussions said Microsoft
had proposed buying Yahoo's search business and taking a stake
in Yahoo after Yahoo sheds its substantial Asian assets.
In Israel this week, Ballmer said Microsoft was now not in
talks to acquire Yahoo, but was looking at other types of deals
with Yahoo, the world's No. 2 Web search service after Google.
The Internet start-ups sector, which has recently seen a
new class of instant-messaging tools, is not being used to its
full potential, Ballmer added.
"There are many businesses that are in some senses
under-appreciated by the market," he said, noting particularly
healthcare start-ups.
"There's an aging population -- it's one of the
biggest-growing parts of the world economy."
(Additional reporting by Eric Auchard in New York; Editing
by Jason Neely)
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