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Icahn Aiming To Oust Yahoo's Jerry Yang As CEO

 

The letter exchange between investor Carl Icahn and Yahoo’s board of directors, currently going at a pace of one letter and one answer per day, may bring up some dirty laundry. In his most recent letter sent to the board, Icahn not only accuses Yahoo’s chairman of the board Roy Bostock of not reading his letters, repeating misstatements, but also of potentially withholding information relating to the Microsoft acquisition offer that could have benefitted Yahoo employees. According to the investor, Microsoft earmarked $1.5 billion for employee retention, which he indicates Bostock may have "neglected to tell [Yahoo’s] employees about."

Icahn also questions Bostock’s compensation of $10,000 per week and the value he delivers to Yahoo in exchange: I believe most of your shareholders would be interested in seeing your time sheets - especially in light of the fact that, in my estimation, most of your so-called "plans" over the last few years have been failures," he wrote. Referring to Bostock’s accusation that Icahn has no plan how to run Yahoo, the investor replied: "Remember the old adage - those who live in glass houses should not throw stones."

Icahn gave one specific example what he would do at Yahoo, if he were in charge. " [...] under my plan, I would ask the Board to bring in a talented and experienced CEO to replace Jerry Yang and return Jerry to his role as ’Chief Yahoo!’." He pointed to Google, who brought in a "great operator" since a "new CEO with operating experience might well have had and might still have a very salutary impact on Yahoo!," Icahn wrote.

Icahn asked Bostock for a reply, so expect an answer from Yahoo’s board later today or early tomorrow morning.

  • Pei-chen
    Yeah right, trust a corporate raider to bring benefit to shareholders. My guess is he’s trying to stir up enough trouble to force Yahoo to pay a premium to buy back the shares he own leaving everybody else a little poorer.

    People like him should be charged with financial fraud but I guess he footed enough political campaign to be untouchable.
    Reply
  • "People like him should be charged with financial fraud"

    As opposed to Yang-er who jacked up a severance package to $2.5Bil (against some recommendations) in order to make it more difficult for Microsoft to acquire them. Some executives can now get as much as 2 YEARS of salary in severance if Microsoft acquires Yahoo. How's that for financial integrity?

    Oh, and Yang had folks prepare a memo on turning down a potential "thrid party" (Microsoft) offer, before THE OFFER WAS EVEN MADE! But I'm sure he was open-minded and had the stockholders best interest in mind when he got the offer!?!?

    If Yang has a credible plan to get the stock from the $19 it was at to the $33 offer then he should remain in charge - given Yahoo's performance and the way they are getting worked over by Google, Yang should be removed for incompetence and lack of fiduciary responsibility for the way he handle the MS offer. Thankfully his days are probably numbered (he may get removed at the next board meeting on Aug 1). If he wanted to own the company, he shouldn't have taken it public and destroyed billions of dollars of stockholders money over the past few years. He no longer owns the company and is answerable to the true owners (stockholders); come Aug 1, we'll see how it goes! I know who I'm voting for as a Yahoo stockholder (it ain't Yang).
    Reply