Icahn's 5-Point Plan for Yahoo

And they say no one writes letters anymore.

Investor Carl Icahn and Yahoo (YHOO) Chairman Roy Bostock this week have been exchanging a series of lengthy missives, each more vitriolic than the ones before, on whether the company is truly concerned with shareholder value, and whether the current board deserves the boot. (Icahn, of course, has nominated a dissident board slate.)

Today, it was Icahn’s turn. Today’s letter starts with a rebuttal to Bostock’s latest rebuttal to Icahn’s previous letter.

The best part: Icahn’s five-point plan for fixing Yahoo:

• Replace the current “poison pill” severance plan with “an acceptable alternative.”
• Find a “talented and experienced CEO” to replace Jerry Yang. He suggests someone along the lines of Google’s Eric Schmidt. (He doesn’t specifically suggest hiring Schmidt. Maybe he has siblings.)
• Tell Microsoft that “unless any alternative transaction can insure a $33 or higher stock price (of which I am skeptical) all talks of alternative transactions are over.”
• Ask the new board to sell Yahoo to Microsoft in a “friendly and co-operative transaction.”
• If Microsoft does not want to deal, ask the board to do a search deal with Google, “but only if it contains termination provisions that would in no way impede a subsequent acquisition by Microsoft.”

Icahn goes on to suggest Bostock ought to “stop dancing around the subject” and publicly offer to sell the company to Microsoft at $34.375 a share.

Roy, I believe you have a letter to write.

Comments

[cezanne:]

Somehow I feel both Icahn and Bostock are up there floating really close to the sun...getting scorched yet basking in their ignorance...

Yahoo! shareholders need a real fix and it's at the core of company not way up top...

2008 Jun 06 03:45 PM

[Alex Filonov:]

34.375?! Icahn would be lucky to get 27.50. But I think he'll get nothing from Microsoft.

2008 Jun 06 03:55 PM

[usbworks:]

Hold the presses! Carl, is that your big plan? Threaten Microsoft with a side deal with Google if they don't cough up $34.75?

News release. Yahoo has been trying that tactic for months and Microsoft called their bluff. But maybe because it's Carl Icahn doing the threatening, Steve Ballmer will give him all his money.

So this is the master poker player? He shows Microsoft that he's holding a pair of 2's and expects them to fold. Wow...

Anybody holding out for larger gains than a $7 premium on Yahoo over its original $19 price deserves far less If you want to gamble, go to Vegas.

2008 Jun 06 04:05 PM

[abdul raab:]

Wow.. so, Jerry Yang comes back to take over the company he started, he's here for about a year... and then the big boys try to throw him out immediately.

How would any of you have any idea what kind of CEO he would make? Just because he decides not to sell out to Microsoft? Laughable.. keep up your criticism .. but remember.. he who lives by the sword... dies by the sword

2008 Jun 06 09:56 PM

[jackooo:]

Slash & burn Icann. Reminds me of his TWA venture.

2008 Jun 09 04:38 PM