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Yahoo Delays Annual Meeting, Urges 'No' Vote On Icahn Slate
Yahoo delayed its annual meeting to gain more time to develop business alternatives that don't involve Microsoft to present to shareholders.
May 23, 2008
3 Min Read
Yahoo on Thursday said it would delay its annual meeting, originally scheduled for July 3, until an unspecified date later in the month and advised shareholders to vote down a slate of board candidates fielded by Carl Icahn, who wants the company to revive merger talks with Microsoft.
Also on Thursday, Yahoo said that a longtime board member, Skyrider CEO Ed Kozel, had resigned from the board "to spend more time with his family."
Yahoo said the delay would give securities regulators additional time to sign off on its proxy statement. It also gives the company a bigger window within which to develop business alternatives not involving Microsoft to present to shareholders when the meeting finally does take place.
Corporate raider Icahn is pushing Yahoo to rekindle merger negotiations with Microsoft and to that end has nominated an alternate slate of directors to stand for election at Yahoo's annual meeting. Yahoo, led by CEO Jerry Yang and chairman Roy Bostock, is said to be pursuing alternative deals.
One scenario reportedly under consideration is an agreement that would see Yahoo outsource search advertising to Microsoft rival Google. If Yahoo can forge such a pact before its annual meeting, it could present the deal to shareholders as a fait accompli.
In proxy papers filed Thursday with the Securities and Exchange Commission, Yahoo urged its shareholders to vote against Icahn's candidates. "We urge you to disregard any proxy card sent to you by the Icahn Entities or any person other than Yahoo," the company said in its filing.
"We do not believe that election of the Icahn Entities' nominees to our Board of Directors is in the best interests of our stockholders," Yahoo said.
For its part, Microsoft appears to be distancing itself from Yahoo. CEO Steve Ballmer on Wednesday said his company is no longer interested in acquiring the Web portal.
"We are not bidding to buy Yahoo," Ballmer said at a launch event for Microsoft's new research and development center in Herzliya, Israel. Speaking in Moscow on Friday, Ballmer added that "Yahoo was never the strategy we were pursuing," according to news agency Reuters.
Microsoft last Sunday revealed in a public statement that it had approached Yahoo "with an alternative that would involve a transaction with Yahoo but not an acquisition of all of Yahoo." The company has declined to elaborate.
The betting is that Microsoft wants a deal that would combine Yahoo's search operations with its own, while allowing Yahoo's portal and display advertising units to remain independent. Yahoo might also spin off its Asian operations, including its stake in Chinese portal Alibaba, under such a scenario, the speculation goes.
Together, Microsoft and Yahoo would control less than 30% of the search market, compared with Google's 61.6% share, based on data released Thursday by ComScore.
Yahoo's current board rejected outright Microsoft's $33-per-share takeover offer. In response, Microsoft broke off acquisition talks earlier this month.
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