Microsoft has launched a £22 billion pound takeover bid for internet search engine company Yahoo.

The internet firm, which has struggled of late, said that "its board of directors will evaluate this proposal careful and promptly in the context of Yahoo's strategic plans."

It added that it would take the course of action it felt would maximize long-term value for its shareholders.

The BBC reports that the offer is 62 per cent greater than Yahoo's closing share price on Thursday.

Indeed, the amount being offered by Microsoft has raised some eyebrows, with Tim Small of the brokerage firm Execution telling the BBC that "the premium seems exorbitant, for what is a dwindling business".

Yahoo started as a hobby for two PhD students who decided they wanted a way to keep track of their personal interests on the internet.

A recent Connect survey found that the two major concerns about outsourcing services like IT support were 'loss of control' (56 per cent) and 'budget over-runs' (43 per cent).