Briefly met Jerry Yang prior to the meeting, and he seemed very relaxed. Only about 100 people in the room…thin. Roy Bostock, the most active board member from Yahoo during the MSFT drama, is up and speaking, and introducing other board members.
CFO and General Counsel Michael Callahan is going through the motion, detailing the proxy voting procedures. Any gold proxy card will not be voted at the meeting..this was the Icahn group card, he mentions. No dissenting shareholders proposed their names to appoint alternate board members…surprise, surprise.
A rep from The United Brotherhood of Carpenters Pension Fund, an investor in Yahoo, is up now, and is challenging the compensation structure of the company (“Pay for superior performance proposal”), and is complaining about the failure for the compensation to relate to long term objectives of Yahoo (NSDQ: YHOO).
A rep from New York City Pension Funds is up now, talking about a proposal against censoring Yahoo’s results in countries like China. The fund wants Yahoo to adopt a proactive code of conduct to not censor its sites and results.
Another pension fund rep, some Mr. Harrington, calls Yang and board members Moral Pygmies, and “that may be insulting the pygmies, by the way”. Ouch…(this phrase has been used before in relation to Yahoo, more specifically by the U.S. Congress)
The board, of course, recommends all the three proposals be rejected. And it took about 32 minutes…the business portion of the meeting is over.
Bostock is back up, and offers to show his timesheet on how many hours he has worked in the last six months, in response to a stockholder question. Despite all the hoopla about the Microsoft bid, there has been tremendous progress in the company, he says. “We agreed last year that 2008 would be an investment year…and we had to improve our financial position considerably in 2009. I want to be very clear: The board controlled the process of the Microsoft bid…we led from the front. The #1 priority was to maximize shareholder value..that was all we talked about in the 30 odd board meetings we had during that period….There was never any doubt to our openness to doing a deal with Microsoft (NSDQ: MSFT). We never resisted Microsoft’s proposal, despite rumors on the contrary. During this period we encouraged Microsoft to be even more engaged. The result was that they reduced their engagement level, and even thought of lowering the bid…In an offhand comment to one of the board members, they said that there may be a few more dollars on the table…it was never communicated formally to the board, or came to us in writing.”
“And I tell you folks, it was hell of a burden to deal with all these offers. We were within our targets in first quarter of 208, we were on target in the second quarter of 2008…their performance was astounding.” Astounding words, indeed…
Yang is up next, and talking about this “Internet Opportunity”, and the growth of internet and mobile users worldwide. “We are not standing still…we are investing in mobile, in international markets, and that’s where the growth is. There is no other company on the Internet that has these assets, and leadership in display advertising. We are a major player in search, second only to Google.”
“We have also been rewiring the company in the last 12 months. We invested in performance advertising business, with Right Media and Blue Lithium. The fact that we invested in those businesses is helping us in this economy.”
Decker is up next, talking about the advertising side of the business for Yahoo, primarily focusing on relevancy in advertising, and of course, display ads. Fundamentally, if we can make display easier to buy, then we will see convergence of search and display buys.
Ultimately, we think mobile will be the starting point of the Web.
Some presentation slides from Decker’s presentation: