Microsoft press officials released the text of Ballmer’s letter to the media one day after unnamed sources close to Microsoft told some reporters that Microsoft was losing patience with Yahoo’s reticence to take up Microsoft on its January 31 offer to buy Yahoo.

Microsoft says Yahoo has three weeks to negotiate a decent deal, after which time Microsoft is going to take his case directly to Yahoo! shareholders, including the initiation of a proxy bidding to elect an alternative slate of directors for the Yahoo! board.

I don’t believe that Microsoft has any real intention of walking away from this deal. I feel there’s so much overlap between Microsoft and Yahoo that this merger seems feasible, but a hostile proxy battle is the surest path to mutually assured destruction. Microsoft shares have already fallen more than 10 percent since the company first sprang its unsolicited bid on Yahoo, and market research has shown that it can take years before companies recover from a hostile takeover.

However, even thou Microsoft implies that Yahoo! has not answered their offer, Yahoo! has released to the press a statement on February 11, concluding that the proposal is not in the best interests of Yahoo! and our stockholders.

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