Yahoo! on Monday released a statement claiming that it will not accept acquisition proposal of Microsoft Corp. because the world’s largest maker of software offered a bid substantially below the real value of the Internet company.

“After careful evaluation, the board [of directors] believes that Microsoft’s proposal substantially undervalues Yahoo! including our global brand, large worldwide audience, significant recent investments in advertising platforms and future growth prospects, free cash flow and earnings potential, as well as our substantial unconsolidated investments,” the statement by Yahoo! reads.

Microsoft proposed to acquire Yahoo! following disappointing quarter results of the latter for about $44 billion back in late January. The two companies would form a formidable giant that would operate in many industries and provide an ultimate amount of services to millions of users worldwide. However, as with every acquisition or merge, the combined company would become somewhat less competitive on certain markets.

“The board of directors is continually evaluating all of its strategic options in the context of the rapidly evolving industry environment and we remain committed to pursuing initiatives that maximize value for all stockholders,” the statement by Yahoo! claims.

Microsoft Corp. said it that it was disappointed by the decision of Yahoo! and it would continue trying to take over the company.

“It is unfortunate that Yahoo! has not embraced our full and fair proposal to combine our companies. Based on conversations with stakeholders of both companies, we are confident that moving forward promptly to consummate a transaction is in the best interests of all parties. The Yahoo! response does not change our belief in the strategic and financial merits of our proposal. As we have said previously, Microsoft reserves the right to pursue all necessary steps to ensure that Yahoo!’s shareholders are provided with the opportunity to realize the value inherent in our proposal,” the statement reads.