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May 20, 2007 Cheap At Twice The Price?
Microsoft Chief Financial Officer Chris Liddell acknowledged on a conference call Friday that like the DoubleClick scenario, Microsoft was also in a competitive bidding war for the aQuantive deal. This is one reason the company is paying a significantly higher price per share for the company than its current market value. With Google's recent purchase of DoubleClick, Yahoo buying Right Media, and WPP Group buying 24/7 Read Media, the real question is with whom were they in a competitive bidding war? Did Microsoft pay an 85% premium to avoid paying twice that much later from a private equity group? Considering that DoubleClick was taken private at $1.1 billion by a financial investor two years ago and returned to the market at $3.1 billion, an 85% premium seems to make sense. This also explains Microsoft's `urging' of regulators to review the Google/DoubleClick deal. And, by the way, Murdoch's bid for the Wall Street Journal looks cheap compared to Google and Microsoft.
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