Microsoft offers to buy Yahoo

Microsoft has tabled a $44.6bn (£22.4bn) bid for web giant Yahoo.

The bid values Yahoo at $31 per share, 62 percent more than the latest common stock value of Yahoo.

Microsoft chief executive Steve Ballmer said a tie-up will allow the two to offer an "increasingly exciting set of solutions for consumers, publishers and advertisers", and enable them to be "better positioned to compete in the online market".

Ray Ozzie, chief software architect at Microsoft, said the deal will mean customers could have "new experiences" the two companies could not produce on their own.

According to Microsoft, the online advertising market is expected to double from 2007 to 2010, hitting $80bn (£40bn) in revenue, meaning the benefits of scale will become more important.