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“Yahoo! Inc. directors meet today to consider Microsoft Corp.’s $44.6 billion bid for the Internet company, a person familiar with the talks said.A takeover by Microsoft, the world’s biggest software maker, is the most likely outcome, analysts and shareholders say. The board, which rejected the offer as too low, is weighing its alternatives, said the person, who declined to be named because the meeting is private.Time is running short for Yahoo Chief Executive Officer Jerry Yang to find a solution. Microsoft chief Steve Ballmer threatened a proxy fight in about two weeks if the board didn’t give in. Yahoo has courted Time Warner Inc.’s AOL and is testing advertisements from Google Inc. to thwart Microsoft’s offer.”“Microsoft remains the most motivated and best capitalized alternative for Yahoo,” Stanford Group Co. analyst Clay Moran said in a note yesterday. “A Yahoo-AOL merger does not provide Yahoo shareholders value equivalent to the existing Microsoft bid.” Boca Raton, Florida-based Moran advises investors to hold on to Yahoo shares.A Piper Jaffray & Co. survey of 20 shareholders indicated a majority would favor Microsoft’s cash and stock offer to no deal, analyst Gene Munster said in a note this week.Yahoo, based in Sunnyvale, California, fell 25 cents to $28.34 in Nasdaq Stock Market trading at 4 p.m. New York time. The stock has gained 22 percent this year. Microsoft shares fell 83 cents to $28.28 and have declined 21 percent this year.Yahoo spokeswoman Tracy Schmaler declined to comment, saying the company doesn’t confirm when its board meets.The BoardYahoo’s 10 directors, who are up for re-election at the next shareholder meeting, are split between members who have served for more than a decade and relative newcomers.Yang, Eric Hippeau and Arthur Kern have served on the board since before Yahoo’s initial public offering in April 1996. Kern is an investor in several media and marketing companies, and Hippeau is managing partner of venture capital firm Softbank Capital Partners. Its parent company, Softbank Corp., helped start Yahoo’s European and Japanese operations in 1996.Edward Kozel, who is the CEO of network platform Skyrider Inc. and one of the board’s three trained electrical engineers, joined in 2000. Gary Wilson and Ronald Burkle joined in 2001. Chairman Roy Bostock and Activision Inc. CEO Robert Kotick joined in 2003. Mary Wilderotter, the only woman on the board, and Vyomesh Joshi, an executive vice president at Hewlett- Packard Co., both arrived in the past three years.`First Instinct’“It’s quite possible that the first instinct of people who’ve been there from the outset would be to look to see if keeping the company independent would be viable,” said Jeffrey Lindsay, a New York-based analyst for Sanford C. Bernstein & Co. “The newer members don’t have the same sentiment or associations with the company.”Lindsay predicts Yahoo shares will perform in line with the rest of the market. He doesn’t own stock in Microsoft or Yahoo.Joshi, Kozel, Bostock and Yang weren’t available to comment. Calls made to numbers listed under Arthur Kern weren’t returned. The other directors didn’t return calls seeking comment.Yahoo hasn’t announced the date of its next shareholder meeting. The last occurred June 12, and under Delaware law, the company must hold one every 13 months.Yang’s ChoicesYang’s alternatives may look less appealing to shareholders than a Microsoft takeover. Investors would get cash and stock up front in exchange for their stakes in Yahoo, whose revenue growth has slid. Analysts including UBS AG’s Heather Bellini in New York suggested that Microsoft might even switch to an all- cash offer or raise the bid.The other options are more complex. In an AOL transaction, Yahoo would gain control of the Internet company, receive an investment from Time Warner and give up a 20 percent stake in the combined entity, a person with knowledge of the talks said this week. The investment also would let Yahoo buy back billions of dollars in stock, the person said.Yang, 39, also forged an agreement this week to run some of Google’s advertisements alongside Yahoo’s Internet search results. The deal, which will include no more than 3 percent of search queries during a trial lasting as long as two weeks, may be another way for Yahoo to bolster revenue as an independent company.Lawmakers LookLawmakers already have said they would examine a Yahoo- Google tie-up if it were made permanent, throwing doubt on whether that is a long-term solution for Yahoo investors.The $31-a-share bid was 62 percent more than Yahoo’s closing price Jan. 31. Because of a decline in Microsoft’s shares since then, the purchase is now valued at about $29.94 a share, as of today’s close.Yahoo has recorded eight straight quarters of declining profit as Google took market share and advertising dollars in the online search engine market. Google accounted for 59.2 percent of Internet queries in February, according to Reston, Virginia-based researcher ComScore Inc. Yahoo had 21.6 percent, followed by Microsoft with 9.6 percent.Ballmer is interested in Yahoo because it would boost his company’s slice of the online advertising market, which Microsoft said may nearly double to $80 billion by 2010.Microsoft “is just getting eaten alive in the fastest growing market, which is search,” Larry Haverty, associate portfolio manager at Gamco Investors Inc., said in an interview on Bloomberg Television yesterday. Gamco managed about $31 billion in assets as of Dec. 31, including shares of Microsoft and Yahoo.To contact the reporters on this story: Amy Thomson in New York at athomson6@bloomberg.net; Zachary R. Mider in New York at zmider1@bloomberg.net.