Acquisition: Investors slam Microsoft’s Skype deal
NEW YORK:
Microsoft Corp’s move to buy money-losing Internet phone service Skype for $8.5 billion was immediately skewered by critics and investors, who questioned the logic of the deal and suggested the software giant is paying far too much. The price is about double the expected value of Skype if it had gone ahead with its planned initial public offering, leaving investors puzzled over how Microsoft will make the deal pay for itself. “I wish they had not done it,” said Whitney Tilson, founder and managing partner of T2 Partners LLC, which owns Microsoft shares. “Initially when I first read about it, I hated the deal. Now, I don’t like it,” said Tilson, who is a long-term buyer of Microsoft shares and still sees them as a great cash-generating business and an undervalued stock.
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