Mumbai: Software giant Microsoft Corporation, which has offered to acquire internet and online advertisement major Yahoo Inc met on Monday to discuss the takeover offer, The Wall Street Journal reported today.

Microsoft Corporation, which made an unsolicited $42 billion offer for Yahoo on 31 January, is still considering a takeover of Yahoo, currently valued at about $40.9 billion.

The meeting, the first since Yahoo rejected the Microsoft offer, wasn't a negotiation as no bankers were present, the report said citing people familiar with the matter.

Yahoo executives mostly listened as Microsoft officials made a presentation of its vision of a combined company, WSJ quoted sources as saying.

Microsoft had offered to buy Yahoo for $31 a share in cash and stock, which Yahoo's board rejected, saying it undervalued the company. Microsoft still considers its $42 billion offer reasonable, considering the current market value of Yahoo Inc of about $40.9 billion.

The offer was originally worth $44.6 billion, before a slide in Microsoft's stock pushed the deal's value down.

"We still think the deal makes sense with the price and structure that we announced and we hope that over time that becomes a reality and we're working toward that," Microsoft chief executive Steve Ballmer said at a news conference on Monday.

Speaking on the sidelines of the technology fair CeBIT in Hanover, Germany, Ballmer said, "There's been a range of dialogue and there's a range of alternatives being considered." He, however, refused to give details of the plans.

Yahoo, meanwhile, plans to move its European headquarters to Switzerland from London over the next year and a half.

"Yahoo! Europe has begun a programme to relocate its European headquarters to Switzerland," the company said in a statement.

"This decision is part of our ongoing international business strategy to increase competitiveness, deliver financial results, performance and efficiencies."

The statement said that the relocation would take about 18 months and would involve five per cent of the company's work force in Europe, it said.