Gates rules out Yahoo acquisition

An acquisition of Yahoo by Microsoft is looking less likely than ever following confirmation from the software company's outgoing chairman that he does not think the deal will go ahead..

Bill Gates made the comments in a TV interview with Tom Brokaw of the NBC network on Friday to mark his last day of full-time work at the software company.

Brokaw asked Gates: "Do you think in a year from now, when you're down at the [Bill & Melinda Gates] Foundation offices, you'll look up at Microsoft and see Yahoo as a permanent wing of Microsoft? Do you think the deal will get done? "

Gates responded: "No, I don't think so. But there are plenty of decisions ahead that Steve [Ballmer] will get to make about what he invests in, R&D, and what kind of deals he does.

"I don't think that one's likely but there are plenty of others that will get done and I'll look on with great respect."

Microsoft abandoned a US$47.5bn offer to buy Yahoo last month, but more recently considered a deal to take a 16 per cent stake in Yahoo to buy its search business to gain a stronger foothold in online advertising.

Gates starts a new chapter in his life today in which he will devote most of his time to his philanthropic venture.