Yahoo braces for Icahn fight

By Yi-Wyn Yen

Yahoo is preparing for a hot and heated summer. In anticipation of a proxy fight with billionaire activist Carl Icahn, the company has delayed its July 3 annual shareholder meeting by a few weeks.

Yahoo (YHOO), in a regulatory filing Thursday, urged its shareholders to vote against the ten-member alternate slate that Icahn proposed last week and to re-elect Yahoo’s current directors. “Our board of directors unanimously recommends a vote for the election of all of the board’s nominees,” the filing stated, “…and urges you not to sign or return any proxy card sent to you by the Icahn entities.”

Icahn bought 4% of Yahoo’s shares and nominated himself and nine others to an alternate slate last week in an attempt to force a sale of Yahoo to Microsoft (MSFT), which withdrew its $47.5 billion offer earlier this month. Billionaire investors T. Boone Pickens and John Paulson have joined Icahn in the proxy fight to remove Yahoo’s board.

Icahn isn’t the only dissident. The filing noted that three other Yahoo shareholders have proposed candidates: Two nominated themselves and another submitted a full slate. The company said it doesn’t believe that the three filed proxy materials by last week’s deadline.

A Yahoo spokesman said the company is pushing back the meeting to give regulators more time to review the proxy materials. The company now plans to hold its annual meeting by the end of July.

In related news, Yahoo said Ed Kozel, chairman of video-sharing startup Skyrider and a former venture capitalist, resigned from its board. In a separate filing, Yahoo said Kozel, 52, wanted to leave in February but stayed on in light of Microsoft’s unsolicited offer. Kozel, like his fellow Yahoo directors, voted against Microsoft’s original offer, announced in February. Yahoo said it has no plans to replace Kozel, which will cut the size of its board to nine members.

Microsoft withdrew its higher $47.5 billion bid on May 3, but has reportedly signaled in recent days its interest in buying Yahoo’s search business and hasn’t ruled out a full-blown acquisition. While many Wall Street analysts believe that a Microsoft-Yahoo deal is inevitable, no one is certain how long that will take.

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Wow, I’m surprised so many shareholders are willing to sell out for a few extra bucks…

Carl Ichan will destroy Yahoo. His stated intention is to sell the company and as a result he will not have any negotiating power with Microsoft. He’s interested in neither ensuring the long term prosperity of the company, technological innovation on the Internet, nor the welfare of Yahoo employees.

I’d sell my shares and resign from the company if his board wins the proxy vote.

Posted By yahoo, internet, us : May 28, 2008 5:31 pm

I think the big ball here is just the google effect which should be competed with. Yahoo could not do it and was hit back hard. Who can do it? Certainly it’s not Icahn. Supporting Micrsoft’s cause will benefit both Icahn and Yahoo and all those who are concerned by the lone-riding Google.

Posted By Abbas, Tehran : May 27, 2008 2:48 am

Duh! Ichan has a history and his only interest is in his profits, but the minority shareholders will reap the benefit also. The mere suggestion that he’ll dismantle Yahoo piece meal is ridiculous. The sum of it’s assets is greater than the individual pieces, and Ichan (and Microsoft) know that. Let Ichan have his proxy board and all shareholder value will increase, not just Ichan’s 4%. Holding on or selling out is the only decision the minority shareholder needs to make after the Microsoft sale.

Posted By Steven Mather, Tampa FL : May 25, 2008 6:27 pm

Microsoft is eating Google’s dust. They have to PAY people to use their search, and still people are using Google instead. They are loosing and loosing fast and their only shred of hope is by acquiring Yahoo. Microsoft needs Yahoo way more than Yahoo needs Microsoft. So I think if Microsoft were smart, they would just raise their bid and get it over with. http://stocksbuyorsell.com

Posted By marinello2003 : May 23, 2008 5:41 pm

What is the concern of a shareholder? It is to maximise the share value and make money – some in short term and some in the long term. When the current YHOO! board appears incapable of doing achieving this on their own, I think it is good for any shareholder to support Icahn’s board and force a MSFT acquisition. This is the only move that can save a sinking YHOO!

Posted By Nav, Columbus OH : May 23, 2008 12:39 pm

I owned Yahoo stock for a while but managed to get at breakeven, after determining that the company was going no where fast, and from what I can tell they still aren’t going anywhere. Better to sell out and get the job done.

Posted By T Thomas Davison,MI : May 23, 2008 11:46 am

Why would we vote for Yang’s stooges who enrich the Hollywood buffoon, Yang, Bostock et al? Yang DESTROYED shareholder value, and we NO longer have confidence in Yang…so our shares go to Icahn or MSFT, or anyone who can actually BOOST its value, by ANY means. Hasta la vista, YANG!!!!!

Posted By Marilyn, Seattle, WA : May 23, 2008 11:01 am

Icahn’s slate has my vote. YHOO’s management has failed.

Posted By Doug, arlington hgts,Il : May 23, 2008 8:44 am

Wow … it’s amazing how the average shareholders of yahoo are willing to vote for Icahn. He does not, and I repeat, does not have the average shareholders in mind. He can care less. As another person said, he’s out to make quick money. Look at his track record and the companies he has dismantled. Now the average shareholders are not exactly reaping the benefits of his carnage. He has no interest in yahoo nor its shareholders. Those who owns a substantial amount of yahoo shares, such as himself, will benefit from this, not the regular shareholder. Jerry should have started buying back his company when he regained the helm.

Posted By Anonymous : May 23, 2008 8:31 am

So, when Carl Icahn dismantles Yahoo and sells it off piecemeal division at a time or at a cut rate to Microsoft, then what? Icahn does not have Yahoo’s best interests at heart nor the investments of other Yahoo stockholders. He has a large stake in Microsoft and wants to sweeten it. Why should one billionaire who probably doesn’t even know how to use email be permitted to destroy a company like Yahoo just because HE CAN?

Posted By Chuck, Portland, Oregon : May 23, 2008 1:21 am

I’m also a shareholder and can’t wait to vote for Icahn’s replacement board

Posted By Rich, Saint Paul, MN : May 22, 2008 10:38 pm

Carl Icahn and his posse are out to make a quick buck for themselves.Total regards for yhoo holders is the last thing on their mind.

Posted By bato chgo. il. : May 22, 2008 9:44 pm

As a Yahoo share holder, I will vote for Icahn’s ten-memeber slate.

Posted By Mydad from Carson, CA : May 22, 2008 7:40 pm

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