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Starboard Launches Proxy Fight To Remove Entire Yahoo Board (reuters.com)

Posted by BeauHD on from the time-to-get-physical dept.

An anonymous reader quotes a report from Reuters: Activist hedge fund Starboard Value LP moved on Thursday to overthrow the entire board of Yahoo Inc, including Chief Executive Marissa Mayer, who has struggled to turn around the company in her nearly four years at the helm. Starboard, which has been pushing for changes at Yahoo since 2014 and owns about 1.7 percent of the company, said it would nominate nine candidates for the board. The proxy fight comes as Yahoo is pressing ahead with an auction of its core Internet business, which includes search, mail and news sites. Yahoo and Starboard could still come to an agreement before the company's annual meeting, expected to be in late June. If they cannot avoid a proxy fight and the Yahoo board election is taken to a shareholder vote, attention will swing to the large mutual and index funds that own the stock and will carry heavy weight in the final tally. Yahoo and Starboard representatives met on March 10 to discuss ways the two sides could avoid a proxy fight, according to people familiar with the matter. But those talks broke down, in part because Starboard was upset by Yahoo's announcement that same day that it appointed two new board directors, these people say.

8 of 136 comments (clear)

  1. What's Yahoo's asset value vs. market cap? by Anonymous Coward · · Score: 2, Insightful

    They could probably make a few bucks selling their office chairs.

  2. One of the problems of public companies... by FlyHelicopters · · Score: 5, Insightful

    One of the problems of public companies is this sort of thing...

    Someone who owns less than 2% of the company is drawing massive attention towards something that will keep the leadership from doing what the company needs long term.

    I would not be shocked if Marissa Mayer has had to devote a lot of time and energy to this sort of thing over the past 4 years, and probably has a much greater awareness of how hard the big chair is. Not because running a company is so hard, but because she has to deal with thousands of investors who all want to give their 2 cents.

    This is one of the reasons that Dell went private, it was the only way to plan longer than 3 months in advance. Wall Street is so focused on quarterly numbers, it is really hard to make 5 year plans. If a company doesn't post impressive results quickly, the CEO gets tossed out and someone new brought it.

    1. Re:One of the problems of public companies... by Austerity+Empowers · · Score: 4, Insightful

      I have yet to see an activist investor who has done anything but ruin a company, intentionally, for his personal gain. The only value I see in their activities is that somehow they manage to break a huge goliath with a stranglehold on an industry by accident, leaving the market open for new blood to come in. Of course when that happens it's because of carelessness on the investors part, normally in that case they just inflate prices beyond all reason.

      TL;DR: Maybe they will die in a fire.

    2. Re:One of the problems of public companies... by ShanghaiBill · · Score: 4, Insightful

      I was wondering how someone with that small of a block could force this

      They can't "force" it. They have to get another 48% of the shareholders to agree with them. They might be able to. Yahoo has been adrift and rudderless for years. The company is worth less than their assets. I live in San Jose, and several of my neighbors work for Yahoo. They are not demoralized about the direction of the company, they are demoralized because the company has no direction. I can't think of a single new Yahoo service, or a single existing service that has improved in the last decade.

    3. Re:One of the problems of public companies... by rahvin112 · · Score: 4, Insightful

      Yahoo was making money during Yang's term. Just not "enough" money. Starboard and the investors that drove Yang out simply want to suck all the money out and walk away.

      As another posters said, I haven't met an "activist shareholder" yet that wants to do anything other that gut the company, take the resources and let the whole thing collapse in on itself and lay everyone off, either that or take all the resources, export all the jobs overseas then let the company be purchased by the Chinese who are quite happy with a 1-3% return because they have national pride and want to support the Chinese economy.

      The CEO's and major investors on wall street these days are destroying this country. They have no national pride, don't give a crap about this country and are only out for themselves even if it destroys the US in the process. Many many are worse than traitors. Shipping all your jobs overseas so you can make an extra 0.5% return at the expense of thousands of American jobs is the opposite of patriotic. These people hate the US and should be treated as such.

  3. Marissa Mayer had a near impossible job... by FlyHelicopters · · Score: 3, Insightful

    Frankly, Marissa Mayer faced a nearly impossible job, turn around Yahoo!, a company that by 2012 was largely pointless in the Internet space and had failed to move into new spaces and allowed new companies to run right over it.

    Ten years before, in 2002, it was a household name, however it largely has lost that due to not keeping up with the times.

    It might well not have mattered who became CEO in 2012, the company was probably already past the point of no return. My mother uses Yahoo, as does my older brother. Our friends who have teenagers? They likely don't even know what Yahoo is.

    1. Re:Marissa Mayer had a near impossible job... by Notorious+G · · Score: 5, Insightful

      The turnaround was difficult but Mayer has botched it pretty badly. Questionable hires for millions - that quickly left the company after nothing accomplished, media investments that make little sense - Couric? Really?, and acquisitions that have proven time and again to be bad investments. With Mayer at the helm, Yahoo's value declined to the point that it was actually negative but for the AliBaba stock. Spin off that stock, and Yahoo is worthless, literally. She's been a train wreck.

  4. Re:Good for her by Anonymous Coward · · Score: 5, Insightful

    You know what's a lot less productive than a telecommuting employee that's already working for the company?

    Nobody working in that position.

    BTW: Another winner company has your same opinion with the same butts in seats position on employees. You may have used their products. BlackBerry.