In response to Carl Icahn’s letter to Yahoo shareholders, Microsoft issued its own statement, agreeing with Icahn, and calling for the entire Yahoo board to be removed.
“While of course there can be no assurance of a future transaction, we will be prepared to enter into discussions immediately after Yahoo!’s shareholder meeting if a new board is elected.”
In other words, depending on how much hair grows back on Steve Ballmer’s head, they may consider improving their offer for Yahoo’s search business, or perhaps even buying the entire company.
According to Icahn’s letter, Ballmer has concluded that he “cannot negotiate any transaction with the current board.” The time period between a deal being made and the clearing of regulatory hurdles “could take at least nine months,” and Ballmer is worried that “the current board and management team of Yahoo! [could] mismanage the company…and a great deal could be lost.”
This new strategy by Microsoft and Icahn could work to their advantage. At this point, Ballmer could probably get away with offering a much cheaper price per share than before and unhappy shareholders will agree to it. The only thing standing in his way appears to be the board, which he and Icahn are now working together to remove. With the board and Yang out of the way, Microsoft could swoop in and make their big move.
Anyway you slice it, Microsoft needs Yahoo’s search business in order to put some chinks in Google’s armor. Live search is garbage and Microsoft is too far behind both Google and Yahoo to play catch up.
On a side note, I hope anyone spending their Fourth of July on the Jersey shore wasn’t bothered by the legions of $30,000 millionaire that came out to “play” this weekend. Hopefully, I’ll make it to the Hamptons next year and avoid that wonderful crowd.
–Ballcahn correspondent Travis