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Comment by pitdesi | Hacker News Reader

Unfortunately, this isn't how finance works, so I can't hire you as CEO.

Yahoo has $1.5Bn in cash. Companies usually get bought for cash and stock that the company owns, or they can issue more stock if it's a merger that gets broad approval. YHOO doesn't have $20Bn to buy companies with, and if they did, they still couldn't make the investments you're talking about. Twitter alone is worth $8.5Bn on the secondary market... It would sell for more than $10Bn. And buying the New York Times for $1.5Bn would incur another bil in debt.

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I think the author is trying to make a point about acquisitions and the value of talent being left alone, not seriously pitch himself as a potential Yahoo CEO hire.

Yahoo's stock is worth 20 billion. You can acquire companies for stock and cash. When a company is public, you can acquire more easily in exchange for stock.

Mark Cuban became a billionaire from his Yahoo stock he got from the acquisition of broadcast.com.

Yahoo's stock is worth 20 billion... and is mostly owned by shareholders. Yahoo can't give it to someone else, because people like me own it.

Edit: Suking is right, they could issue new shares... IF people actually wanted Yahoo shares and a target company would actually accept them. (would not happen)

They would create new shares. If they buy someone for $4bn, they create $4bn in new shares and if the public market values the acquisition at $4bn, the price will remain the same. Usually, companies that acquire pay a premium and will take a dip though.

Not mention even if they had the $20B to buy all those companies. You now have a portfolio of companies that really don't make much/any money. Those smart people aren't going to work for free!

I was waiting for him to suggest he would also buy Google & Facebook.

Nailed it. Surprised he didn't add, "I'd go back in time 10 years and buy google for $1mm". Might as well have added that in to his pitch.

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