WORLD> America
|
WORLD> America
|
|
Microsoft backs Icahn's bid to oust Yahoo board
(Agencies)
Updated: 2008-07-08 12:35 Monday's turn of events amplifies the pressure on Yahoo co-founder and CEO Jerry Yang, whose handling of the earlier negotiations with Microsoft infuriated many shareholders. Yahoo's stock price had plunged by more than 30 percent to fall below $20 during Yang's first six months as CEO. Then, in January, Microsoft raised hopes for a quick windfall with its unsolicited takeover bid, only to be repeatedly rebuffed. If he seizes control of the board, Icahn has promised to fire the 39-year-old Yang as CEO and replace him with a more seasoned leader. Yang has been meeting with Yahoo's major stockholders during the past week, hoping to persuade them to give him a chance to prove the Sunnyvale-based company is worth more than the $33 per share that Microsoft previously offered. Ballmer withdrew that bid after Yang sought $37 per share - a height the stock hasn't reached in 2 1/2 years. In its Monday statement, Microsoft didn't mention how much it thinks Yahoo is worth now. Industry analysts estimated Microsoft would likely pay anywhere from $28 to $33 per share if it takes another stab at swallowing Yahoo whole. "Microsoft is still asking Yahoo shareholders to make a big decision with incomplete information," said Standard & Poor's Internet analyst Scott Kessler. "I could still see a scenario where the Yahoo board is replaced and Microsoft comes in with a bid that is lower than people want. Then what do you do?" Microsoft more recently has been trying to pry away Yahoo's search engine for $1 billion, plus an additional $8 billion investment for a 16 percent stake in Yahoo's remaining operations. Yahoo instead opted for an online advertising partnership with rival Google Inc. that is supposed to boost its annual revenue by $800 million. That alliance faces an antitrust review by the US Justice Department because Google and Yahoo combined control more than 80 percent of the US search advertising market. In its Monday statement, Yahoo asserted Microsoft is trying to use Icahn to engineer a purchase of Yahoo's search engine in a deal that would hurt the company in the long run, by hindering its ability to compete in the Internet's rapidly growing ad market. |
