Yahoo Investor Pushes For a Microhoo at $22 a Share

Just as Yahoo's share prices drop below the $13 mark, one of its investors seems to be getting nervous and has proposed that Microsoft buy Yahoo at a 74 percent premium of the current share price.

That's compared to the 62 percent premium initially offered and rejected back in February, so it's certainly a bold offer for a company who's shares have recently sunk to levels unseen since 1998.

Mithras Capital owns more than 1.9 million shares or 0.14 percent of Yahoo. Under its proposal "Microsoft would unload Yahoo's Asian assets and non-search businesses, extract $3 billion worth of cost savings and receive $2.8 billion of tax benefits, meaning the software giant would pay $10.3 billion for Yahoo's search business," reports Reuters.

While some analysts have suggested that a Microsoft-Yahoo deal is still possible, it has seemed more and more unlikely lately as Microsoft approved a $40 billion buyback, and Yahoo continues talks with Time Warner on an AOL deal. 

But as shares plunge and a Yahoo-Google search deal weathers a regulatory storm, Mithras says now is as good a time as any for Microsoft.

"It is imperative for Microsoft to act now, while the Yahoo-Google deal is mired in regulatory concerns, and before Yahoo strikes a deal with AOL," said Mark Nelson, a partner at Mithras.

Investor proposes Microsoft buy Yahoo for $22 per share [Reuters]

By Chris Snyder for Wired.com