Steve Ballmer wouldn't rule out Yahoo acquisition


— 11:18 AM on May 11, 2007

About a week ago, the Wall Street Journal reported that Microsoft and Yahoo were taking a new look at the possibility of a merger. Now, Yahoo News has published a PC World report that suggests Microsoft may indeed be considering such a deal.

During an interview at the Software 2007 conference in Santa Clara, California, Microsoft CEO Steve Ballmer was asked whether Microsoft "would acquire a company with a '$40 billion or $50 billion' valuation." The question omitted a direct reference to Yahoo, but its intent was pretty clear—Yahoo's market value was $42 billion last week, according to the WSJ. In response, Ballmer said Microsoft never discusses potential buyouts. However, he added, "We have not, by default done a lot of big acquisitions... but we wouldn't rule it out." At the event, Ballmer also discussed the "software as a service" business model but maintained that Microsoft preferred a "software and service" approach that combined traditional software and online services.

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