By Yi-Wyn Yen
It appears you can blame Microsoft if Yahoo’s employees start slacking off and business partners flee.
Late Wednesday afternoon, Yahoo (YHOO) submitted a Securities and Exchange report that called Microsoft’s attempt to buy the company a “significant distraction for our management and employees.”
Yahoo says the chaos surrounding the unsolicited bid could result in its losing key advertisers, publishers, clients and talent. It also noted that as a result of the bid it’s facing seven costly lawsuits from shareholders who want the deal to go through.
Two weeks ago, Yahoo’s ten-member board of directors rejected Microsoft’s nearly $45 billion offer, saying it was too low.
That hasn’t stopped Microsoft (MSFT), with its very deep pockets, from trying to arm twist Yahoo into a deal. Last week Wall Street learned that the software giant was preparing a bitter proxy fight to try to oust Yahoo’s board. Hours later, Yahoo began erecting a defense, notifying the SEC that it would offer its full-time employees enhanced severance packages if a change in ownership resulted in layoffs.
Yahoo’s latest signal flare to the SEC was tacked on at the end of a 10K filing under the section, Risk Factors. Here’s the report: