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Microsoft said it will need to borrow money for the first time in company history to acquire Yahoo, chief financial officer Chris Liddell said.

Microsoft said that it plans to pay $44.6 billion for Yahoo, half in stock and half in cash. The company has around $21.1 billion in cash, cash equivalents and marketable securities. Microsoft expects the deal to be completed by the second part of this year.

"It's likely we're actually going to borrow for the first time," said Liddell in an annual strategy meeting with analysts Reuters reported. "It's going to be a mixture of the cash we have on hand plus debt."

Liddell would not say if Microsoft is currently purchasing yahoo stock on the open market. He did not provide any information on what form of debt Microsoft will turn to in the capital markets.

"Microsoft can probably get a lower price of debt than equity," said Kim Caughey, senior analyst at Fort Pitt Capital Group. "I've often wondered why Microsoft sits on the pile of cash. It doesn't make a lot of financial sense."