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Joint Proposal of Microsoft-Icahn to buy Yahoo is rejected.

Activist investor Carl Icahn and Microsoft made a joint proposal to buy Yahoo has been rejected. A statement by Yahoo issued Saturday, they said that it had rejected the proposal which is similar to a previous offer that Yahoo had been turned down.

On the previous months, Microsoft withdrew its 47 billion dollar offer to buy Yahoo. But last Friday, a joint proposal by Icahn and Steven Ballmer of Microsft was made for Yahoo. The new proposal said that Yahoo was to sold its search business to Microsoft and Icahn’s campaign to remove the current boards of Yahoo.

According to Roy Bostock - Yahoo’s Chairman:

It’s ludicrous to think that our board could accept such a proposal, while this type of erratic and unpredictable behaviour is consistent with that we have come to expect from Microsoft, we will not be bludgeoned into a transaction that is not in the best interest of our stockholders.

Yahoo added that the proposal that submitted by Microsoft last Friday “contains a number of improvements,” but still wasn’t good enough.

It also said it would accept a sale of its search business, but on better terms. Yahoo has already struck a search advertising partnership with Google, one it could break by paying a breakup fee. By relying on Google’s superior technology to show some ads alongside the search results on its Web site, Yahoo expected to boost its annual revenue by about 800 million dollars.