Earlier today, computing giant Microsoft made an offer of $44.6 billion dollars to purchase internet giant Yahoo.  The merger would result in a massive internet entity that would challenge Google as the largest search engine on the web.  Yahoo has not responded to the offer as of yet.

Yahoo has suffered financial difficulties recently, announcing they would be laying off 1000 employees and seeing their stock fall to $19.18, a record low since the dot-com bust.  This leaves Yahoo in a very vulnerable position, as MS is offering $31 per share; a price shareholders may find hard to turn down.

The bid comes as a something of a surprise to market experts, may of whom feel that a takeover would rob Yahoo of its innovation and subject it to the bureaucratic mire that Microsoft is known for.  In addition, it is highly likely that the US Justice Department will be investigating the possible merger for anti-trust violations.  Microsoft has been under federal oversight since their anti-trust settlement six years ago.

What effect, if any, this will have on Microsoft’s gaming division is not yet clear, but we will keep you updated as info becomes available.