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Judge OKs Settlement In Yahoo Shareholder Suit
narramissic writes "On Friday, Judge William Chandler III of the Delaware Court of Chancery approved a settlement that will roll back a Yahoo employee severance that was implemented by Yahoo's former leaders. Some investors, including the vocal Carl Icahn, described the plan as a poison pill, arguing that the severance payouts would be so expensive that no company would want to acquire Yahoo. The settlement narrows the reasons why employees can quit and receive the severance, removing some of the incentives for them to leave the company in the event of a Yahoo acquisition, whether by Microsoft or some other suitor."
And in other news, Yahoo slips further into irrelevance.
The world's burning. Moped Jesus spotted on I50. Details at 11.
"We are very pleased that the settlement was approved because we believe it is in the best interests of the company and our shareholders," the company said in a statement.
I think it really means:
"We are very pleased that the settlement was approved because we believe it is in the best interests of the executives and maybe our shareholders," the company said in a statement.
Yeah, I'm a cynical old bastard, but can you blame after what's happened in the last six months?
I was thinking that these severance agreements were supposed to be a poison pill to discourage a corporate take over.
Times they are a changin'.
Shop smart, Shop S-Mart.
I must congratulate the P.R. team behind Icahn. The press keeps calling him "activist investor" when "corporate raider" would be a far more appropriate term...
http://www.dieblinkenlights.com
Relax. In a year, Yahoo will be like Circuit City, and if you show up early enough at the Big Closeout Event, you'll be able to buy the "You've Got Mail" wave file, along with toilet paper rolls and the portrait of Jerry Yang that he used to whack off to in his private bathroom.
The world's burning. Moped Jesus spotted on I50. Details at 11.
Again the execs with million-dollar buyout packages and short-term traders will scrape a few more crumbs into their fat mouths off the already nearly-empty plates of the ordinary folks who actually make the company go.
s
What you say would be true if stocks were valued according to expected long-term return, but they aren't. They're primarily valued circularly: based on expected value in the next 3-12 months.
10 PRINT CHR$(205.5+RND(1)); : GOTO 10
If I've understood, and this is not necessarily the case, I admit, the judge has just decided that he is authorized to modify contracts in order to give financial benefit to particular groups of investors. He is effectively interfering in the market. Is that his job?
Let's imagine that I enter into an employment contract with a company, and this contract says that in certain circumstances I can leave and get a payout (let's say 12 months salary).
This payout is to compensate me for the time it will take for me to find another job. The cost and risk in known up front to both parties; the company and me. The contract is signed by authorised signatories of the company, who get this authorisation from the directors, who ultimately are authorised by the shareholders to make decisions about hiring and compensation policy.
Now along comes a judge, who says "I think that this contract is detrimental to the share price, ergo detrimental to the finances of certain shareholders; I have decided to unilaterally modify or annul this contract as I see fit".
The judge is appointing himself to be a kind of super-president of the company: not elected to the board by shareholders, but with some kind of moral right to interfere in the company's policies and practises.
Please feel free to correct me if I've got hold of the wrong end of the stick, but from reading TFA, that is my interpretation.
K.
There are some people (not to mention any names), including some iconic people, who need to be dumped into the wilderness wit nothing but a pair of briefs and a knife, to find out what it's really like when the wolves get ahold of the little guy.
I think the argument for this would be that since the shareholders did fire the board that made the deal the judge considers the act of signing the contract something done agains't the will of the owners/shareholders and has taken it upon himself to reverse this.
Think of it in another way, what if the CEO/Chairman of a listed company would transfer all the funds of that company into his own account. He did have authority to access the accounts, but the act itself would certainly be considered theft.