Ballmer: Microsoft would buy Yahoo after board change

Almost a month ago, Yahoo announced that it had broken off all talks with Microsoft, and it quoted the software giant as saying it was "not interested in pursuing an acquisition of all of Yahoo!, even at the price range it had previously suggested." According to Carl Icahn, what Microsoft actually meant was, "We'll only be interested in an acquisition if a new board gets voted in."

That (paraphrased) sentiment is the gist of Carl Icahn's latest letter to Yahoo, in which the billionaire investor says he's "spoken frequently" with Microsoft CEO Steve Ballmer over the past few days. Icahn claims Ballmer told him he can't trust the existing Yahoo board to manage the company properly during a merger, but he'd be prepared to resume negotiations immediately if shareholders elected a new board at the forthcoming stockholder meeting.

Yahoo postponed that meeting until "an undetermined date in late July" a couple of months back, shortly after Icahn bought 59 million Yahoo shares and signaled his intent to oust the current board. With the prospect of either a full merger with Microsoft or a sale of Yahoo's search business a real possibility once again, many shareholders could end up on Icahn's side later this month.

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