Yahoo to Icahn: You Have Your Facts Wrong

Yahoo (YHOO) last afternoon released the text of a lengthy letter to Carl Icahn from Yahoo Chairman Roy Bostock. The company’s basic position is that Icahn doesn’t get it, and that the company remains willing to talk to Microsoft (MSFT) or anyone else about a potential deal as long as the price is right.

“Unfortunately, your letter reflects a significant misunderstanding of the facts about the Microsoft proposal and the diligence with which our board evaluated and responded to that proposal,” Bostock wrote. “A fair-minded review of the factual record leads to one conclusion: that Yahoo’s 10-member board, comprised of nine independent directors along with Yahoo CEO Jerry Yang, remains the best and most qualified group to maximize value for all Yahoo stockholders.”

He goes on to oppose the notion of replacing the board “for the express purpose of trying to force a sale of Yahoo to a formerly interested buyer who has publicly stated that they have moved on.”

A couple of other tidbits from Yahoo’s response:

• The company they remain willing to enter into any transaction “that would maximize value for stockholders and provide them certainty of value.”
• The Yahoo board met over 20 times to review the MSFT deal.
• Yahoo and Microsoft execs and their advisers met in person seven times.
• Yahoo says that MSFT never put its $33 offer in writing, or said what the cash/stock mix of the proposal would be.
• He repeats that the company told MSFT it would be willing to sell at $37.

This one looks, far, far from over.

Comments

[User 71887]

I am always amazed and insulted at how directors at underperforming companies feel that they "are the best and most qualified group to maximize shareholder value"...Excuse me, but what has prevented them from doing this over the last few YEARS? Not only was YHOO stock stuck in limbo under their great oversight, but when a real suitor like MSFT shows up and gives them a "layup" to do what they couldn't and wouldn't do in another few years, they botch that up too. They couldn't even negotiate a few dollars extra a share from the initial MSFT offer. How insulting to shareholders. These directors should be lynched...unless they deliver a better offer immediately. Otherwise, I would like them to clarify WHY they believe they are the best group to increase shareholder value and then to prove it. Meeting 20+times does not qualify...show me results, not effort!

[jackooo]

9 independant directors at $5,000 ea. per meeting equals $45,000 per meeting. If there were 20 meetings that would amount to $900,000.
Not much accomplished for that kind of money.

[bill d]

If this wasn't so stupid it would be funny-

"The company’s basic position is that Icahn doesn’t get it, and that the company remains willing to talk to Microsoft (MSFT) or anyone else about a potential deal as long as the price is right."
AND WHAT THE HELL WOULD THAT PRICE BE ???
Probably 1 or 2 bucks above the offer !!!

"A couple of other tidbits from Yahoo’s response:
The company they remain willing to enter into any transaction “that would maximize value for stockholders and provide them certainty of value.” "
OH REALLY ???
If I were a stockholder and unless my cost was $30 or less I would be seriously pissed.
I guess the board wants to make all their stockholders (suckers) independently wealthy.
Oh well - just enjoy those fabulous dividends and stock appreciation - thanks to MSFT and Icahn.
Of course if I were a director at $5K a pop and some other expenses/perks I probably wouldn't want to lose that either !

[bill d]

"If I were a stockholder and unless my cost was $30 or less I would be seriously pissed. "

I meant $30 or MORE !"
Sorry.