The blood is still dripping, no doubt, this morning from Microsoft CEO Steve Ballmer’s poison pen. On Saturday, he dashed off the dread missive to Yahoo CEO Jerry Yang that would end his hot pursuit of the Internet giant. While we want to point out that this is kind of like the person you aren’t even interested in dating getting all formal about breaking up with you, we imagine it’s not the last Wall Street will be hearing of this unholy union. (Especially since a separate, even unholier union in the form of an ad pact between Yahoo and Google festers on.) Here, the blow-by-blow of what finally sent this deal off the rails, as well as some choice excerpts from Ballmer’s tough-love letter.

Yahoo Inc. Chief Executive Jerry Yang didn't really want Microsoft Corp. to buy his company. By Saturday, Microsoft CEO Steve Ballmer didn't want that either, leaving both technology giants facing fundamental questions about their futures.

The failed courtship leaves Microsoft with limited options for quickly expanding its presence online. However, it might not close the door to the software maker's pursuing another bid for Yahoo down the road.

In a letter to Mr. Yang Saturday in which he withdrew Microsoft's acquisition offer, Mr. Ballmer cited a divide over price, saying Microsoft had been willing to raise its offer for Yahoo to $33 a share, or about $47.5 billion, and Yahoo demanded at least $4 a share more.

Microsoft's pursuit of Yahoo was among the latest moves in the scramble by technology and media companies to capture the flood of advertising dollars moving online and to block Web powerhouse Google Inc. from extending its dominance in online-search advertising.

Mr. Ballmer had said in recent days that he was confident Microsoft could go it alone to build a competitive online-advertising business without buying Yahoo. At the same time, he had faced skepticism from within Microsoft about its ability to pull off such a large acquisition at a time when the software maker faces many other challenges. Mr. Ballmer himself had shown hints of such doubts in recent weeks, said people familiar with the matter.

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