Microsoft - Yahoo! Talks Heat Up

As late as Thursday Microsoft had been reported to be willing to take its offer for Yahoo! hostile, but on Friday it appeared negotiations between the two companies intensified, as a sweetened offer drew Yahoo! to the table.

However, according to the Wall Street Journal (paid subscription required) and people familiar with the matter, the deal is nowhere near imminent, although reports are discussions have begun on a mid-$30 price / share for Yahoo!.

Microsoft's original cash-and-stock offer, due to changes in stock price, was worth $29.39 a share as of the close of NASDAQ Market trading on Friday.

Just yesterday, Steve Ballmer, speaking to Microsoft employees at Microsoft's HQ in Redmond, Washington, said that he wouldn't pay "a dime above" more than what he felt Yahoo! was worth, and that he was ready to walk away if necessary.

Originally Microsoft had given Yahoo! a deadline of last Saturday to agree to terms, and that they would make an announcement regarding the deal would be made this week, but that announcement was obviously delayed by the ensuing negotiations.

Many still believe a deal is inevitable, but the question is when and for how much?