Yahoo's CEO says still open to Microsoft

The headquarters of Yahoo Inc. is pictured in Sunnyvale, California, May 5, 2008. REUTERS/Robert Galbraith

NEW YORK (Reuters) - Yahoo Inc Chief Executive Jerry Yang said on Monday it was Microsoft Corp that left the negotiating table and he was still open to discussing a deal with the software maker.

“We were negotiating a way to find common ground and then on Saturday they chose to walk away,” Yang told Reuters in an interview. “They started it and they walked away.”

Asked if Yahoo would still leave a door open to talks, Yang said: “If they have anything new to say, we would be open ... I am more than willing to listen.”

Yahoo shares fell 15 percent on Monday after Microsoft pulled its $47.5 billion offer for the Internet company. After three months of negotiations, Microsoft CEO Steve Ballmer had raised his offer to $33 per share from an initial $31, but Yang had held out for $37 per share.

Some analysts said Yahoo shares could have dropped further on Monday, but investors were hoping Microsoft would eventually come back to the table. Others expect Yahoo to face a flood of shareholder lawsuits questioning why its management did not accept the bid.

Yang said he had spoken to many Yahoo shareholders since Saturday and their reaction to the breakdown of the talks had spanned the entire spectrum from disappointment to support.

“There are some that are disappointed that a deal was not reached and there are others that are probably pleased we didn’t do the deal at $33,” he said. “The bottom line is we went in there to have honest and good faith negotiations and they walked away. We didn’t walk away.”

Asked whether Microsoft’s move was a negotiating tactic, Yang said he could only take Ballmer’s letter to him announcing the withdrawal “at face value.”

“My view is we are moving on and they said they’re moving on,” he added.

Editing by Andre Grenon