Yahoo chief executive Jerry Yang sent a message to employees on Wednesday, assuring them the firm's leaders are exploring ways to avoid a takeover by software giant Microsoft.
In an email to Yahoo workers, Yang said the board of directors has yet to decide how to respond to Microsoft's offer to buy the veteran Internet company for $44.6 billion in cash and stock.
"Our board is thoughtfully evaluating a wide range of potential strategic alternatives in what is a complex and evolving landscape," Yang wrote in the email, which was filed with the US Securities and Exchange Commission.
"What's become clear in the past few days is how much people care about this company. I've heard from many of you, and from other friends and colleagues from around Silicon Valley and across the globe, that we need to do what's best for Yahoo and our shareholders."
Microsoft's unsolicited offer to pay the equivalent of $31 per share for Yahoo highlights the 14-year-old California firm's potential to recapture past glory, Yang told employees.
Microsoft publicly announced what it billed as a "generous" offer for Yahoo on February 1 and said its plan is to combine resources to take on Internet powerhouse Google.
Google has come out against the proposed takeover, condemning it as an attack on the freedom of the Internet.
Yahoo has said little more than its board is carefully reviewing options that include keeping Yahoo an independent company.
Yahoo has received calls from "a number of interested parties" and has a wide range of strategic options, a source close to Yahoo told media.
Those options include outsourcing online advertising to arch-rival Google, a proven master at pumping revenues from that well.
If it spurns Microsoft's offer, Yahoo's board of directors will be under pressure to give stockholders a soothing cash payout or even borrow money to buy back shares and turn the firm private.
The offer comes as Yahoo is losing ground rapidly in the Internet space to Google, the search leader which has cashed in on the market for online advertising.
Yahoo announced plans last week to lay off 1,000 workers, seven percent of its employees, as part of an effort to reallocate resources and bolster its bottom line.