Yahoo Is Said to Rebuff Microsoft Threat Over Bid

Yahoo is expected to respond by early Monday to a letter from Microsoft that threatened to lower the price of its buyout offer and take it directly to Yahoo shareholders, people close to the company said on Sunday.

Yahoo’s response is expected to reject negotiations and explain why Yahoo’s board believes the current offer price is too low. Although Microsoft’s offer was initially valued at $31 a share, a drop in the price of Microsoft shares has reduced the offer to just over $29 a share.