Apparently, Microsoft's CEO Steve Ballmer isn't taking Yahoo's rejection very well. Published reports indicate that Ballmer fired back at Yahoo's board for not "embracing" his $44.6 billion offer and reiterated his intention 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 NY Post reports that sources have said Microsoft has hired proxy solicitation firm Innisfree in anticipation of a proxy battle to replace Yahoo's board. Ballmer has until March 13 to nominate directors.

As we reported yesterday, Yahoo has desperately been seeking alternatives to a Microsoft takeover, including restarting talks with AOL.