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Microsoft’s Ballmer, Gates Oppose Breaking Up Company

Microsoft CEO Steve Ballmer
Steve Ballmer, chief executive officer of Microsoft Corp. Photographer: Simon Dawson/Bloomberg

Nov. 16 (Bloomberg) -- Microsoft Corp. Chief Executive Officer Steve Ballmer and Chairman Bill Gates, responding to a request to consider breaking up the company to boost the return for investors, say they aren’t in favor of the idea.

The executives made the remarks after a question at an investor meeting in Bellevue, Washington. Microsoft, which makes most of its money from its Office and Windows computer software, also offers everything from Xbox video-game machines to mobile-phone programs to Hotmail Web e-mail services.

A breakup doesn’t make sense because the computer industry is consolidating, Ballmer said. “I don’t think it would be useful,” he said. “It creates economic dis-synergies.”

In October, Goldman Sachs Group Inc. suggested that Microsoft might spin off some consumer businesses, including the Xbox division, so that it could better focus on its main products. Microsoft’s shares have tumbled 15 percent this year, hurt by concern that it’s losing ground to mobile software from Apple Inc. and Google Inc. A slow recovery among corporate customers also is weighing on sales, Goldman Sachs said.

Microsoft, based in Redmond, Washington, fell 23 cents to $25.81 at 4 p.m. New York time in Nasdaq Stock Market trading.

To contact the reporter on this story: Dina Bass in Seattle at dbass2@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

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