Microsoft's eager attempt to buy out Yahoo, the rival internet giant, on the 1st of February, 2008, is still under hot discussion. Microsoft had offered to pay Yahoo a total sum of US$44.6 billion valued at US$31 per share, which later came down to US$42 billion.

Yahoo initially rejected the bid saying it is too low and that there has to be a better package for Yahoo to even consider the buy out.

In a recent development, Microsoft threatened Yahoo to accept the bid offer of US$31 per share within a time span of three weeks or else be ready for a hostile takeover by Microsoft if it descides to go directly with the offer to the Yahoo shareholders. The message was conveyed through a letter to the Yahoo management, which was made public.

Yahoo has again rejected the offer but has not outrightly rejected the idea of a possible buy-out. It is still bargaining it's worth and is ready to accept a better offer, or so it seems.

Microsoft seems extremely threatened by the Search Engine Giant and market leader Google and is aiming to show Google down by buying out the third largest Internet leader Yahoo. Yahoo is also well aware of the situation and is counting on Microsoft to raise the bid in hopes that Microsoft would be ready to pay even more in order to take on Google.

Let's see how this story finally ends.