News

Icahn Moves To Force Yahoo Sale to Microsoft

Corporate raider Carl Icahn plans to replace Yahoo's entire 10-member board with the intention of compelling a sale of the company to Microsoft, according to an open letter sent today to Yahoo's Chairman Roy Bostock. Icahn's letter states that he has formed his own list of candidates to replace Yahoo's board.

Today was the last day to propose board candidates in preparation for final votes to be held on July 3 at Yahoo's annual shareholders' meeting.

Microsoft walked away from its bid to acquire Yahoo on May 3, but some Yahoo shareholders brought suit and complained that Yahoo's management should have accepted the deal. In his letter, Icahn claimed that he was asked by Yahoo shareholders to "lead a proxy fight to attempt to remove the current board" in order to facilitate Microsoft's acquisition of the company.

Icahn said he bought about "59 million shares and share-equivalents of Yahoo" and plans to acquire "approximately $2.5 billion worth of Yahoo stock."

He complained that Microsoft's final offer, offering Microsoft's stock at $33 per share, was "superior" to Yahoo continuing as an independent company, and that the Microsoft-Yahoo combination would be "a force strong enough to compete with Google on the Internet."

Microsoft had been seeking to add Yahoo to bolster its Web search ad market position, which currently puts it at a distant third place behind No. 1 Google and No. 2 Yahoo.

Icahn nominated himself as a candidate for the board, as well as Keith Meister, vice chairman of Icahn Enterprises.

Other proposed candidates include former Viacom head Frank Biondi, Dallas Mavericks' basketball team owner Mark Cuban, Harvard Law Professor Lucian Bebchuk, Hawkeye Investments President John Chapple, Impact Venture Partners' Adam Dell, Ocean Road Advisors' CEO Edward Meyer, former ClearBridge Advisors' CEO Brian Posner and former Co-CEO of New Line Cinema Robert Shaye.

Microsoft initiated its unsolicited bid for Yahoo more than three months ago, but Yahoo management held out for a stock offering of $37 per share, saying that Microsoft undervalued the company. Microsoft's management then dropped the bid this month. Subsequent public statements by Microsoft executives have implied that the bid for Yahoo is "over."

About the Author

Kurt Mackie is senior news producer for 1105 Media's Converge360 group.

Featured

  • Report: Cost, Sustainability Drive DaaS Adoption Beyond Remote Work

    Gartner's 2025 Magic Quadrant for Desktop as a Service reveals that while secure remote access remains a key driver of DaaS adoption, a growing number of deployments now focus on broader efficiency goals.

  • Windows 365 Reserve, Microsoft's Cloud PC Rental Service, Hits Preview

    Microsoft has launched a limited public preview of its new "Windows 365 Reserve" service, which lets organizations rent cloud PC instances in the event their Windows devices are stolen, lost or damaged.

  • Hands-On AI Skills Now Outshine Certs in Salary Stakes

    For AI-related roles, employers are prioritizing verifiable, hands-on abilities over framed certificates -- and they're paying a premium for it.

  • Roadblocks in Enterprise AI: Data and Skills Shortfalls Could Cost Millions

    Businesses risk losing up to $87 million a year if they fail to catch up with AI innovation, according to the Couchbase FY 2026 CIO AI Survey released this month.