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Microsoft CEO says Yahoo buy was never strategic

MOSCOW - Microsoft Corp Chief Executive Officer Steve Ballmer said on Friday the company had never seen buying Yahoo as strategic, and dropping the bid meant it now had $50 billion to spend on other acquisitions.

"Yahoo was never the strategy we were pursuing," he told a packed hall at a technology conference in Moscow.

"We will spend money on some acquisitions. You can do a whole lot of things with 50 billion dollars," he added.

Microsoft walked away from a proposal to acquire Internet media company Yahoo for $47.5 billion, or $33 per share, after Yahoo rebuffed the offer earlier this month, saying it would only settle for $37 per share.

In Israel this week Ballmer said Microsoft was now not in talks to acquire Yahoo, but was looking at other types of deals with the U.S. No. 2 search engine.

Microsoft has already made an offer to buy Yahoo's search business and take a minority stake in the Web firm, a source familiar with discussions recently told Reuters.

Ballmer also dismissed suggestions Microsoft's Silverlight technology would merge with its rival Adobe System Inc's Flash technology to combat competition from a potential merger between Adobe and old Microsoft rival Apple Inc.

"We compete with Flash ... I'm open-minded, but there's really no discussion of merging with Adobe. Developers should all learn Silverlight," he said.

The Internet start-ups sector, which has recently seen a new class of instant-messaging tools, is not being used to its full potential, Ballmer added.

"There are many businesses that are in some senses under-appreciated by the market," he said, particularly healthcare start-ups.

"There's an ageing population -- it's one of the biggest-growing parts of the world economy."