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Ballmer rejects Microsoft break-up

No value in splitting company, CEO tells shareholders

Ballmer rejects Microsoft break-up
Ballmer said that synergies between businesses, such as Xbox, Bing and voice recognition, means that Microsoft is too tightly integrated for a break up.

Microsoft CEO Steve Ballmer has rejected calls from shareholders to break up the company into smaller businesses.

At the company’s annual investors meeting, Ballmer said there was no value to be had in splitting the business, despite shareholder requests to do so.

Some investors are concerned that despite the company reporting record first-quarter revenue of $17.37 billion for the quarter ended 30th September, Microsoft’s share price has been mainly static for the past ten years.

Ballmer pointed to synergy between product groups and said that these outweighed any break up advantages: “There’s nothing I see as creating fundamental value in splitting the company up. Having minority investments makes it harder to manage synergies.”

He also said that he believes the Xbox console is on track to become the market leader worldwide, and also promoted the upcoming Windows 8 operating system.

Bill Gates, the company chairman, defended the large cash balance held by Microsoft, currently over $57 billion, saying that the balance was necessary to enable the company to take big risks, even during economic uncertainty.

The Microsoft board of directors was approved at the meeting, with over 98% of shareholders voting in favour of the board and he executive pay structure.

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