Yahoo is in trouble after Microsoft has ruled out buying the company.

Yahoo famously turned down a bid from Microsoft earlier this year, claiming that it was undervalued.  It also wired a poison pill into everyone’s contracts so that anyone who took the company over would have to pay staff shedloads of cash.

Lately, however, Yahoo’s shareprice has dropped lower than a flat worm that has been stomped on by an elephant which has been living off hydrogenated vegetable fat for 20 years, and the outfit has had to repent of its arrogance. Yahoo Chief Executive Jerry Yang has been asking Microsoft to come back to the negotiating table, but until now Microsoft has been quiet. Now Microsoft Chief Executive Steve Ballmer has ruled out making another bid for the Internet outfit.

Ballmer said he made an offer, then made another offer, and it was clear that Yahoo didn't want to sell the business and so Microsoft moved on. Ballmer said that he didn’t want to go back and re-look at an acquisition. He didn’t know why Yahoo would, either. Yahoo turned Microsoft down at $33 a share saying that it was worth a lot more, he pointed out. Yahoo was trading at $12.25 a share on Friday.

Ballmer said that he was sure that there were some opportunities for some kind of partnership around search, but acquisition of Yahoo is so last year. Of course, Ballmer might be bluffing and wanting to see  the price of the company drop.  Most analysts think that Microsoft will eventually buy the troubled search engine.