Icahn Ready to Dump Yahoo Board

by , 11:25 AM EDT, May 15th, 2008

Carl Icahn, well known billionaire and investor, thinks Yahoo "completely botched" Microsoft's buyout offer and is now presenting his own pro-Microsoft proxy board in an effort to oust the Internet search and advertising company's current board. Mr. Icahn is hoping that if his board nominations are accepted, Microsoft will return to the negotiation table and close a deal with Yahoo, according to the Wall Street Journal.

Mr. Icahn commented "It is quite obvious that Microsoft's bid of $33 per share is a superior alternative to Yahoo's prospects on a standalone basis."

Mr. Icahn's board nominations include himself; lieutenant Keith Meister; Dallas Mavericks owner Mark Cuban; former Viacom Inc. Chief Executive Frank J. Biondi Jr.; venture capitalist and brother of Dell CEO Michael Dell, Adam Dell; Harvard professor Lucian Bebcuk; former Nextel Partners CEO John Chapple; former CEO of the ad agency Gray Global, Edward Meyer; money manager Brian Posner; and the founder and co-CEO of New Line Cinema, Robert Shaye.

He added in a letter to Yahoo Chairman Roy Bostock "the board of directors of Yahoo has acted irrationally and lost the faith of shareholders."

Microsoft presented Yahoo with an unsolicited buyout offer in February for US$44.6 billion. The was offer undervalued, according to Yahoo, and was rejected.

Microsoft eventually pressured Yahoo to the negotiating table with an ultimatum and the threat of a hostile takeover attempt. The Redmond-based company ultimately walked away from its offer claiming the buyout no longer made fiscal sense.

Mr. Icahn, however, disagrees and is pushing to get the two companies to strike a deal if his board nominees are elected.

Microsoft has not expressed interest in restarting talks with Yahoo.