Blog Post

Yahoo Keeps its Enemies Closer

Jerry Yang, Yahoo’s CEO, may be learning something about the hard-driving style of management it takes to go it alone after an attempted takeover, especially if he follows Om’s logic and thinks Yahoo is about more than search. This morning, Yahoo said it will allow corporate raider Carl Icahn three seats on a newly expanded Yahoo board in an effort to settle the disagreement that is taking up so much of the web portal’s attention this summer. This ends the proxy battle, and Yang has brought Icahn in-house despite — or perhaps because of — the trouble he’s caused.

The deal gives Icahn and two other board members of his choosing spots on an 11-member board. Shareholders will choose from Icahn’s previously named slate of potential directors and newly named Jonathan Miller, currently a partner in Velocity Interactive Group and former chairman and CEO of AOL. This will settle the proxy battle Icahn began after Microsoft’s failed bids for Yahoo earlier this year, and make the Aug. 1 shareholder meeting a less contentious one.

However, it’s unclear what this peace offering means for Microsoft, which has expressed interest in doing a deal with Icahn should he gain control of Yahoo. Icahn’s board presence isn’t likely enough to sway Microsoft to put up the cash required to do a deal that Yahoo might sabotage while waiting for the closing. We’ll update the story as Microsoft comes out with its stance.

6 Responses to “Yahoo Keeps its Enemies Closer”

  1. Ya Hoo

    Jonathan Miller?

    Jonathan Miller?

    The man who presided over the death spiral of AOL?

    Guess that shows how few people want to go near the YHOO board

  2. Stacey Higginbotham

    Alan, I will admit to being as tired of the story as you sound like you are, but Yahoo is still the portal to the web for millions and still has a $30B market cap. Unlike GM it is also making some smart investments in its future, and if it could rectify its culture issues, it could be so much more than what it is now.

  3. However, if you know what to expect and come prepared with Yahoo of a deal, you should enjoy the proxy battle just fine. A deal are usually about $ 20-25 each. It is impossible to adequately describe Yahoo’s but CEO — and you — will be enchanted.