Got $12 Billion More?

Yahoo plans to reject Microsoft's offer of $31 per share for the company according to developments over the weekend. Yahoo is seeking something closer to $40/share. Looks like Jerry Yang is going to man-up and take on Steve Ballmer. Even though Steve is a newbie to big takeovers, my money is on Mr. Softee getting this deal done. Yahoo does not have a staggered board meaning that all of its directors are up for re-election at once. They also do not have preferred shares or any other class of supervoting securities to protect them from hostile takeovers.  March 13^th is the last day to nominate competing directors at Yahoo. According to Yahoo's by-laws, it is easy to push directors out if they do not get majority shareholder approval. The problem is if Microsoft mounted a proxy fight, that provision doesn't apply because Microsoft will provide more nominees than available director seats. The Wall Street Journal suggests that Yahoo may be betting that Microsoft does not want to go "hostile" since it may cause deep resentment among the rank-and-file engineers it still needs to continue the company's success. I don't see any other option for Yahoo at this point, either way some of the yahoos are going to have to start cleaning out the desks.