November 13th, 2008
Yahoo dips below $10; Icahn, board called out
Yahoo’s stock is struggling to stay above $10, the ad deal with Google is in the history books and Microsoft has been quick to say “Not interested.” And CEO Jerry Yang has turned into the Internet whipping boy over it.
But Kara Swisher over at AllThingsDigital poses the $64,000 question (or is it the $31-per-share question) that everyone should be asking: Where in the world are Carl Icahn and Yahoo’s board of directors? After all, they are Yang’s boss and Icahn made such a stink over taking control of that board - first with a proxy fight and then a settlement that included a few new board seats - you would think that a major shakeup would be happening.
But, nope. Investors tell Swisher that board members “have no sense of urgency or seem to feel any pressure to do anything, even though by every metric they have failed.” Another investor told her: “With all the other things going on in the economy, I have just decided to move on and write Yahoo off…but the lack of action by the board is really hard to understand.”
Ouch. Wasn’t Icahn, who attended his first official meeting as a board member back on September 24, supposed to come in and play Rambo on the company? And didn’t he bring a couple of his boys as backup - Frank J. Biondi Jr., former Universal Studios chairman and CEO and former head of Viacom, and John H. Chapple, former CEO of Nextel Partners - to help shake things up? If nothing else, give us a search deal with Microsoft, at the very least. Instead, nothing.
In many respects, Icahn’s proxy shakeup with Yahoo resembles what happened with Motorola. Icahn in 2007 launched a proxy fight for a Motorola board seat. He lost that battle, but remains a shareholder. Motorola in 2008 cut a deal to put two of Icahn’s picks on an expanded board. In other words, no one really wants an extended proxy war. The problem: Icahn’s proxy maneuvering and Motorola’s move to placate him hasn’t done anything for the stock.
Yahoo’s stock dipped as low as $9.76 today - the first time since 2003 that it’s fallen under $10. Shares were up almost eight percent, closing at $11.15 in regular trading. In after hours trading, however, shares dipped, down to $11.02. A financial timeline for Yahoo is below. (Click to enlarge)
Sam Diaz is a senior editor at ZDNet. See his full profile and disclosure of his industry affiliations.
Subscribe to Between the Lines via Email alerts or RSS.
| 11/14/08
