Archive for Icahn

Yahoo And Icahn Play Nice…. I Guess.

Posted in Commentary with tags , on August 15, 2008 by itnerd

This press release just crossed the wires. It seems that there is peace between Yahoo and Carl Icahn now that’s it’s official that his two picks are on the Yahoo board. Jerry Yang even has a few nice things to say:

“No other company in the Internet space has our unique combination of a global brand, the industrys best talent, innovative technologies and exceptional assets; strengths we believe will help us take advantage of the opportunities we see ahead. I look forward to working together with Frank, John, and the rest of our board to continue the progress weve made on our strategy to be the starting point for the most Internet users, a must buy for the most advertisers, and to develop the worlds most open platforms.

Whatever. Sadly, this won’t keep Yahoo out of the news for all the wrong reasons. But at least one of those reasons won’t be Carl Icahn.

Icahn And Yahoo Cut Deal…. Peace In Our Time?

Posted in Commentary with tags , on July 21, 2008 by itnerd

It seems the nasty proxy battle between Carl Icahn and Yahoo is over. Yahoo has argeed to hand over three board seats to Icahn in exchange for him dropping the proxy battle. Besides taking a board seat himself, Icahn will be able to recommend two other directors (likely from the bunch that he named as part of his “gang of nine“). Eight of Yahoo’s nine current directors, including Yahoo CEO Jerry Yang, will fill the remaining seats. One Yahoo director by the name of Robert Kotick will not stand for re-election. By the end of this, the Yahoo board will have 11 seats.

This does not however settle the fate of Yahoo in terms of if Microsoft takes some or all of it over. Nor does it likely deal with the fact that Icahn created all sorts of ill will during the proxy battle. So this soap opera is not quite over yet.

Oh yeah, Yang better watch his back.

Legg Mason To Yahoo: We Got Your Back [UPDATED]

Posted in Commentary with tags , on July 18, 2008 by itnerd

When it comes to proxy battles, the only shareholders that matter are Institutional ones as they hold large amounts of stock and can influence which way these battles go. Therefore it’s a good thing for Yahoo that Legg Mason Capital Management who owns 4.4% of Yahoo stock has said that it will vote for Yahoo’s current board:

“We believe the current Board acted with care and diligence when evaluating Microsoft’s offers. We believe the Board is independent and focused on value creation for long-term shareholders,” Bill Miller, chairman and chief investment officer of Legg Mason said in a release.

If other Institutional investors follow the same path, Icahn may not win this battle. Expect similar statements to start appearing over the next few days.

UPDATE: Yahoo now has a site that gives its spin on the proxy fight.

Yang To Yahoo Shareholders: Icahn Out For Himself

Posted in Commentary with tags , on July 17, 2008 by itnerd

In the latest salvo in the ongoing war between Carl Icahn and the Yahoo board led by CEO Jerry Yang, The latter decided to stir the pot write a letter to Yahoo shareholders. In it he says why Icahn’s plan won’t work:

“Mr. Icahn has made it clear that his only objective is to sell part or all of Yahoo! to Microsoft. That fact, combined with his lack of an operating plan going forward, means that he will have no leverage to negotiate a fair deal with Microsoft. He has set himself up for failure.”

and:

“Second, Mr. Icahn and his slate lack the working knowledge of Yahoo! and its Internet business needed to do two things that are required to successfully deliver a value-enhancing transaction for Yahoo! stockholders. First, they do not have the detailed knowledge to negotiate a complex restructuring of a large, innovative high technology company in a rapidly changing environment. Second, they do not have the hands-on experience to manage and lead Yahoo! during the approximately one year period estimated to be required to gain regulatory approval for a deal or to manage and lead the remainder of the Company (non-search) after a transaction is completed. Don’t take our word for that. Mr. Icahn will be calling the shots if his slate wins and yet Mr. Icahn himself told the Wall Street Journal last fall: “Technology hasn’t really been one of the things I’ve focused on too much before” and “It’s hard to understand these technology companies.” That’s why you need a knowledgeable, experienced and independent board to represent your interests vis-a-vis Microsoft.”

and finally:

“Carl Icahn bought his stock two months ago for an estimated average cost of less than $25 per share. He is well-known as a corporate agitator with a short-term approach to his investments. His short-term approach gives Mr. Icahn a strong incentive to strike any deal with Microsoft that enables him to recover his investment and get back his money quickly, even a deal that does not provide full and fair value to you. Is that in the interests of all stockholders? Clearly, it is not.”

The letter urges shareholders to vote using the white proxy card in favour of the current board of directors.

I expect Icahn to hit the roof when he sees this (and likely fire off a response). Whether this has any effect on shareholders is another matter.

Icahn Gets His “Gang Of Nine” Ready For Battle [UPDATED]

Posted in Commentary with tags , , on July 14, 2008 by itnerd

After getting the big “F.U.” from Yahoo over the weekend. Carl Icahn has decided that enough is enough and has decided to file the paperwork to run a slate of nine people to replace the Yahoo board. Some interesting names pop up on this list, including Mark Cuban (Dallas Mavericks Owner), Adam Dell (Brother of Dell CEO  Michael Dell) as well as Icahn himself.

So it’s officially on. Jerry Yang is going to war against Carl Icahn. One thing to consider is that shareholders may not vote for his “Gang Of Nine” because Icahn has no plans for the company beyond selling it to Microsoft.

Regardless of who wins, it’s going to be bloody.

UPDATE: Here’s the latest letter from Carl Icahn.

Yahoo Punts Microsoft/Icahn Offer…..Vents Spleen Too

Posted in Commentary with tags , , on July 13, 2008 by itnerd

Yahoo announced that late on Saturday night that it rejected a joint-buyout proposal that Microsoft and investor activist Carl Icahn offered the night before, which called for a “complex restructuring” and sale of Yahoo’s search business to Microsoft:

“The proposal was made on Friday evening and Yahoo! was given less than 24 hours to accept the proposal, the fundamental terms of which Microsoft and Mr. Icahn made clear they were unwilling to negotiate. After reviewing the proposal with its legal and financial advisers, Yahoo!’s Board of Directors determined that accepting the proposal is not in the best interests of its stockholders.”

Oh yeah, Yahoo Chairman Roy Bostock took some shots at Microsoft and Carl Icahn:

“This odd and opportunistic alliance of Microsoft and Carl Icahn has anything but the interests of Yahoo!’s stockholders in mind. Clearly, Microsoft, having failed to advance in search, is aligning with the short-term objectives of Mr. Icahn to coerce Yahoo! into selling its core strategic search assets on terms that are highly advantageous to Microsoft, but disadvantageous to Yahoo! stockholders. Yahoo’s Board of Directors will not allow that to happen. Yahoo!’s Board remains open to any transaction that delivers full value to our stockholders – we just do not believe such a transaction should be dictated by Microsoft and a single short-term investor.”

Ouch. There’s more of that in the press release I linked to. Take a read for yourself and see how ticked off the Yahoo gang are.

I expect a response from Carl Icahn at any moment. That should be “entertaining.”

Yahoo To Microsoft: We Won’t Talk To You

Posted in Commentary with tags , , on July 11, 2008 by itnerd

Apparently the Microhoo saga has taken another twist. Carl Icahn’s favorite punching bag, Jerry Yang said he was unlikely to meet with people from Microsoft in regards to talking about Microhoo. Expect this to start another pissing contest round of letters between Icahn and Yahoo in the lead up to the Aug. 1st sharholders meeting. To add to the fun, Rupert Murdoch has said that News Corp. involvement in Microhoo is “unlikely” and added his $0.02 worth on Microhoo:

“There won’t be a deal. There are bad personal feelings,” he said. “In six months, Microsoft will walk away.”

If the Yahoo sharholders meeting was on pay-per-view, I’d pay to watch it. It’s going to be one hell of a show.

Icahn And Ballmer Plot Yahoo Overthrow

Posted in Commentary with tags , , on July 7, 2008 by itnerd

It seems that in some back room someplace, Carl Icahn and Steve Ballmer are plotting to overthrow Jerry Yang and the Yahoo board. Icahn for his part posted a letter to shareholders detailing that he has the support of Microsoft:

“Steve (Ballmer) made it clear to me that if a new board were elected, he would be interested in discussing a major transaction with Yahoo, such as either a transaction to purchase the ‘Search’ function, with large financial guarantees or, in the alternative, purchasing the whole company.”

Microsoft then backed up what Icahn said in a letter of their own:

“While, of course, there can be no assurance of a future transaction, we will be prepared to enter into discussions immediately after Yahoo’s shareholder meeting, if a new board is elected.”

So it sounds like Microhoo may be back on in some way shape or form if Icahn gets his way. Yahoo didn’t waste any time in responding to all of this:

“If Microsoft and Mr. Ballmer really want to purchase Yahoo!, we again invite them to make a proposal immediately. And if Mr. Icahn has an actual plan for Yahoo! beyond hoping that Microsoft might actually consummate a deal which they have repeatedly walked away from, we would be very interested in hearing it.”

It almost sounds like Yang and company are trying to make things happen so that he can save his skin maximize shareholder value.

It should be intersting to see what happens next.

Yahoo Kills Talks Between Itself And Microsoft…. Aligns Itself With Google

Posted in Commentary with tags , , on June 12, 2008 by itnerd

The news that Yahoo is not going to keep talking to Microsoft is crossing the wires at the moment. This caused Yahoo shares to dive 13% on the news. At the same time, Yahoo has announced an advertising deal with Google, which is sure to send chairs flying in Redmond. The story that I linked to also has a chronology of events that makes it look like a deal was possible at one point in the day. It also notes that three execs at Yahoo are leaving the sinking ship departing.

This is sure to make Carl Icahn go ballistic. I can’t wait for the letter that he sends Yahoo regarding this.

Yahoo Sends Employees FAQ On Severance Plan….. The Spin Is Making Me Dizzy

Posted in Commentary with tags , on June 11, 2008 by itnerd

In an attempt to spin things in a way that favors them present its side of the story, Yahoo has sent out an FAQ on its controversial severance plan to its employees. If you recall, Carl Icahn has accused Yahoo of creating the plan to make the company unattractive to buyers by acting as a $2.4 Billion “poison pill” if there was a change in control at the company. Yahoo disputes that in the FAQ:

“Mr. Icahn says this Plan costs $2.4 billion. Is that what it actually costs?

No. An estimate of the amount, if any, payable under the Plan requires making assumptions about unknown facts and variables including: (1) the number of employees who terminate employment without Cause or for Good Reason within the two years following any Change in Control, (2) each such employee’s job level and base salary, (3) the number of equity awards held by each such employee on their respective severance date, the portion of those awards that are not otherwise vested on that date, and the applicable exercise price of any option awards, (4) the market price of the Company’s common stock at the time such awards are ultimately exercised or paid, and (5) the length and level of reimbursement for health care benefits and outplacement services utilized by each such employee.

Mr. Icahn quotes the $2.4 billion estimate, taken out of context, from a complaint filed in litigation against the company. This number is necessarily based on a number of assumptions, including the assumption that all of Yahoo!’s employees are terminated without Cause or leave for Good Reason following a Change in Control. No one believes that such an assumption is reasonable. For the record, the same preliminary analysis referenced in the lawsuit and relied on by Mr. Icahn and using the same assumptions (including a $35 per share stock price) as those underlying the $2.4 billion figure showed that the total payout would be $845 million or $514 million, assuming that 30% or 15% of the employees, respectively, are terminated without Cause or leave for Good Reason following a Change in Control.”

They also toss this in as well:

If Yahoo! remains an independent company and no Change in Control occurs, what happens to the Plan?

The Plan stays in effect until the Yahoo! Board of Directors modifies or terminates the Plan.”

I think that translates to “if we win the proxy fight, the severance plan will be canceled.” Of course, that assumes that angry shareholders don’t have it canceled first.

Expect Icahn to fire back at Yahoo at any time.