Yahoo! said on Wednesday (25) that Microsoft was willing to invest US$ 8 billion in the Internet company, as long as she sold her US search tool$ One billion.

In a letter to shareholders, Yahoo! states that the investment would be conditional on signing a ten-year exclusive agreement that would leave Yahoo! "depending on Microsoft for all your internet search activities."

"It would also give Microsoft the right of veto in certain future Yahoo! shares, including a Yahoo sale!" says the letter, signed by Roy Bostock, chairman of the board, and Jerry Yang, chief executive of the company.

Yahoo! had already informed that Microsoft was no longer interested in buying the Internet company, even by US$ 33 per share previously offered, which would give a total of US$ 47.5 billion.

But Bill Gates' company made an alternative proposal, to buy only the search sector, but the deal was not closed – this week, they came up rumors that the companies had resumed negotiations on the subject.

Dispute

The letter to the shareholders is an attempt to show Yahoo's shareholders! that the deal with Google, closed this month, is more attractive than a partnership with Microsoft. According to the agreement, Yahoo! will display ads marketed by Google on its search system and other websites from the United States and Canada. As the alliance does not provide for exclusivity, Yahoo! can choose between displaying its own ads, Google's or other partners.

The internet company expects the alliance to be responsible for a US billing$ 800 million a year –the estimated value for the first 12 months is US$ 250 million to US$ 450 million. However, the alliance may face problems with trade regulators.

Even with these values, Yahoo shareholders! They weren't very pleased. Many of them, like billionaire Carl Icahn, pressed the board to accept the sale to Microsoft. Icahn even resigned Yahoo's chief executive, Jerry Yang.

In the message to shareholders, Bostock and Yang seek to disqualify Icahn's attempt to replace Yahoo's board of directors!. "The events that have occurred in recent weeks highlight the fact that the board of directors [of Yahoo!] is more qualified to represent their interests in the effort to maximize the value of actions than the group proposed by Carl Icahn," says the text.

[.Via Leaf Online.]