Newspaper reports last Friday had said that Yahoo was expected to reject the bid on the grounds that the amount offered was too low.
 
'Haggling'
 
Analysts also say Yahoo is both angling for a better price and guarding against any possible lawsuits from stockholders who feel they deserve more money.

"Yahoo is not saying no at any price - they are saying the Microsoft offer is not strong enough"

Rob Enderle, analyst

"Right now they are haggling," Rob Enderle, a Silicon Valley analyst, told the AFP news agency.
 
"Yahoo is not saying no at any price. They are saying the Microsoft offer is not strong enough."

Any hostile bid by Microsoft to take over Yahoo would involve the US software giant making offers directly to stockholders and trying to replace Yahoo's board members in upcoming March elections.
 
If successful, a merger of Microsoft and Yahoo would be the world's largest of two computer technology companies and create a formidable rival to Google.

Source: Agencies