Icahn do a deal says would-be Yahoo buyer
By John Lister
Yahoo has reached a deal which staves off both a full-fledged takeover of the company by investor Carl Icahn and the immediate prospect of a Microsoft merger.
The firm has negotiated a settlement in which Icahn and two members of his choice will join the Yahoo board. In return, Icahn won’t try to launch a takeover attempt which would have targeted CEO Jerry Yang.
Yahoo was running out of time to set-up an agreement: its annual shareholders meeting, where Icahn would have made his bid, is on 1 August.
Most analysts and reporters believed Icahn would have immediately looked to set up a deal with Microsoft if he’d taken the Yahoo leadership role. As he already owns just under 5% of Yahoo, that likely would have meant a bumper payday if Microsoft had paid cash for the firm.
However, the threat of a Microsoft deal appears to have been the main factor limiting Icahn’s takeover chances. It’s reported that, after pressure from Yang, other stockholders refused to back Icahn’s bid, seeing him as opportunist.
The deal’s finer details involve the board expanding from 8 to 11 members. Eight existing members will stand for re-election (meaning they are certain to get the posts) while a ninth is retiring. Icahn gets a guaranteed position, and the remaining two slots will be selected from the nine candidates Icahn had originally planned to use in his takeover bid.
The PR machine is already in full effect with Yahoo’s chairman Roy Bostock saying “We look forward to working productively with Carl” while Icahn said “I believe this is a good outcome and that we will have a strong working relationship going forward”.
The Microsoft deal now looks unlikely in the short term. However, Icahn has made it clear he still expects the Yahoo board to seriously consider any formal bids to takeover the company.
Related:
Entry was posted
on Monday, July 21st, 2008 at 5:36 pm
under 
Print This Post
Read more entries by John Lister.
Stumble It!
