Yahoo Activist Investors Seek Options for Yahoo

June 16th, 2008 at 12:00 am


Well, since Microsoft and Yahoo broke up and Google finally accepted Yahoo’s search business proposal, those who wanted to oust Jerry Yang and Roy Bostock, Icahn et al., have simmered down to think of their next move.  Icahn seems to be thinking a lot about the Yahoo and Google deal.

"While the Google deal is not the same as an offer of $34.375 per share for Yahoo, I am continuing to study it, and it might have some merit," Icahn told Reuters in his first public comments since Yahoo disclosed the Google ad-sharing deal on Thursday. [Reuters]

There has been no word from the Icahn camp whether or not they would withdraw the proxy battle they filed against the Yahoo board of directors.  Icahn did not comment on the issue which could mean that he’s accepted the fact that Yahoo won’t become Microsoft’s or may he’s just planning his next move.

On the other hand, another activist investor of Yahoo suggests that the Yahoo board and Icahn’s team meet sort of half way.  Eric Jackson suggested that Icahn and Yahoo split the board, with Icahn’s team taking the minority.  Making the score Yahoo 5 – Icahn 4.

The reason for the split would be a sensible organizational continuity.  Jackson says, "I want Icahn to win outright, but I am putting forward this ‘third option’ because I fear several large investors will worry about the operational abilities of Icahn and his team."

Furthermore, Jackson emphasizes who gets kicked off the board.

"In my opinion, the current members of Yahoo’s compensation committee (Chairman Roy Bostock, Ron Burkle, and Art Kern) should not be re-elected, as they were each the subject of the highest "against" votes at last year’s meeting. They are also responsible for lading out excessive stock options to their fellow directors and senior executives over the last four years."