Yahoo response to Microsoft withdrawing bid

(Reuters) -Microsoft Corp dropped its bid to buy Yahoo Inc after the Internet company rejected its offer to raise the price by $5 billion to $47.5 billion.

Following is a statement from Yahoo Chairman Roy Bostock on Saturday in response to Microsoft's move:

"We remain focused on maximizing shareholder value and pursuing strategic opportunities that position Yahoo! for success and leadership in its markets. From the beginning of this process, our independent board and our management have been steadfast in our belief that Microsoft's offer undervalued the company and we are pleased that so many of our shareholders joined us in expressing that view. Yahoo! is profitable, growing, and executing well on its strategic plan to capture the large opportunities in the relatively young online advertising market. Our solid results for the first quarter of 2008 and increased full year 2008 operating cash flow outlook reflect the progress the company is making. Today, Yahoo! has:

-- a refined strategic focus to drive enhanced volume and yield;

-- reorganized to focus its efforts on its most promising

products and services;

-- invested in innovations designed to revolutionize display advertising and facilitate closing the competitive gap in search; and

-- enhanced expense and resource management to support improved profitability."

Yahoo Co-founder and Chief Executive Officer Jerry Yang said: