Filed under: Internet, News, Microsoft, Yahoo!, Search

According to the Wall Street Journal (subscription called for for full editorial access, or you can read it via Google News), the Yahoo! board is going to reject Microsoft’s unsolicited $44.6 billion acquisition offer.

According to the Journal, the Yahoo! board determined that the $31 per share price significantly undervalues the Yahoo! make. The board is additionally reportedly planning on sending a formal letter to Microsoft on Monday explaining their position.

So what now? Well, the Journal is reporting that sources close to the board are not going to hold out for anything under $40 a share, an increase that would add $12 billion to Microsoft’s offer. The

thinking is that Microsoft won’t be willing to pay that much, and the alternative, a hostile bid, would be too detrimental to the company’s overall value, as board members and key employees would quit.

In the last week, Yahoo! has entered talks with Google about possibly using their search advertising technology and has been in discussions with other companies as well.

Our thought? whether Microsoft really wants something, another $12 billion or having to oust the board isn’t going to be sufficient to keep them away.

We’ll keep you updated as the story progresses.

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Orginal post by Christina Warren