RPT-Microsoft seen buying Yahoo without raising price

(Repeats story published on Sunday to widen distribution)

* Twenty-seven of 28 financial analysts responding to poll expect Microsoft will succeed in buying Yahoo

* Twelve analysts expect Microsoft to stand by its initial offer price of $31 per share in an equal mix of cash and stock

* Four analysts expect Microsoft to keep offer at $31 per share but make all-cash offer, effectively raising deal value

* Twelve analysts expect Microsoft to raise price to between $31.50 and $35 per share

By Eric Auchard and Daisuke Wakabayashi

SAN FRANCISCO/SEATTLE, March 16 (Reuters) - Microsoft Corp's (MSFT.O) offer to buy Yahoo Inc (YHOO.O) will likely succeed, but it may not be the best use of the company's ample cash reserves, according to a poll of analysts by Reuters.

The stand-off between Microsoft and Yahoo has stretched six weeks since the world's largest software maker went public with its proposal. The Web pioneer subsequently rejected Microsoft's offer, which currently values Yahoo at $41.4 billion, saying the takeover bid "substantially undervalued" the company.

The Reuters poll finds Wall Street brokers who follow either company remain convinced that Microsoft will prevail in its takeover. Eight of eight Microsoft analysts surveyed and 14 of 15 Yahoo analysts believe Microsoft will get the deal done.

"Yahoo's options are becoming more limited and it makes Microsoft's offer look better," said Andy Miedler, an analyst at Edward Jones, who has a "hold" rating on Microsoft.

Twenty-one brokerages responded. Seven brokers have analysts who follow both companies and their votes were counted separately. In total, 33 financial analysts currently follow Yahoo and 40 analysts track Microsoft.

Analysts at three firms -- Morgan Stanley, Goldman Sachs and Lehman Brothers -- are restricted by their firms from publishing research on the merger as their investment banking arms are working on behalf of either Microsoft or Yahoo.

There is disagreement, however, over whether Microsoft must raise its half-cash, half-stock bid in order to succeed. A majority of analysts believe that Microsoft need not boost its bid beyond the current $31-per-share offer, although some argue it may need to sweeten the bid by making it an all-cash offer.

Twelve believe Microsoft will not alter its bid and succeed, while four expect it to keep the price at $31 but make it a more lucrative all-cash offer.

"The change in deal terms to all cash could be the next step in this ongoing mergers and acquisition dance in our view," UBS software and Internet analysts said in a joint research note published on Friday, arguing for a $31 cash bid.

"In the interest of expediency and given the benefits of a friendly deal, we still expect Microsoft to raise its offer to consummate the transaction," UBS said.