Our response to Carl Icahn

Posted May 15th, 2008 at 3:48 pm by Nicki Dugan, Blog Editor

 9 Comments / Filed in: Trends & News

As you no doubt saw earlier today, financier Carl Icahn has announced that he intends to nominate a slate of ten directors to our board of directors at our annual stockholder meeting. Here’s the letter he sent to our chairman, Roy Bostock, and here’s a response we just issued.

Nicki Dugan
Blog Editor

Tagged: carl icahn, news

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9 Comments Add your own

J. Payne | May 15th, 2008 at 4:52 pm

Ummmm Icahn… Shouldn’t you be spending your time on fixing your large investment like Blockbuster??? or AOL Time Warner?

Netflix has been kicking Blockbuster all up and down the block… And AOL-TW has turned sour and stagnant since shareholders forced- those companies to merge.

pankaj | May 15th, 2008 at 7:50 pm

Fitting reply to My Carl Icahn. I like the way Yahoo has handled the situation. In the midst of so much of turmoil, yahoo has been launching products (new and improved). This goes to show how determined Yahoo is, to keep itself bold and independent. Microsoft’s reputation as an online player is not great and they have been slow in web innovation, so much unlike their desktop s/w business. In other words, Microsoft is seeking one way value addition (yahoo to MS) in this whole deal, just to stay competitive against industry leader Google (in ad business).

Mandy | May 15th, 2008 at 8:45 pm

From the response:
“From the beginning of the process with Microsoft, Yahoo!’s independent directors focused on one central goal: how best to maximize stockholder value.”

Somewhere in my naive mind I have this idea that big companies primarily ought to make decisions based on what’s best for the users at the base. The customers, the masses of John and Jane Does should be in focus, not the few stockholders. Granted, I think rejecting the Microsoft offer achieved exactly that, it was the best they could do for the user base. People -the people I know- did and do choose Yahoo because it is *not* Microsoft, and I don’t know anyone who’s thrilled about the potential prospect of getting merged into Microsoft that way. But still… I mean, I’m not saying, I’m just… saying…

ehtreads | May 15th, 2008 at 9:44 pm

Reading the qualifications of the Icahn gang, I do not see a single technology/internet visionary. It reflects pure business greed. I personally am fairly certain that the gang of 10 (except on technically qualified person) are just interested in filling their pockets in the immediate future. I am not one bit inclined to believe that they are interested in the long term about Yahoo as a competitive player in the web domain, the Yahoo users, Yahoo’s shareholders or last but not the least the Yahoo employees. It will be a death blow if Icahn and his gang succeeds.
On the funny side, if Icahn (is it an extra ‘h’), I am sure Y!can do it themselves…

Edward Palonek | May 16th, 2008 at 7:53 am

As a shareholder can I just say, “Why can’t we all just get along?” This could hurt the company. I see yahoo as a much better service then google anyhow. Google has nowhere to go but down, yahoo up. my 2 cents palonek-edward.ca

Andrew | May 19th, 2008 at 1:37 am

Wow…lay the smack down, Roy! That was excellent; you’re getting my votes.

J.P. | May 20th, 2008 at 3:35 pm

Yahoo brought this on themselves…. Because they never- should have merged their instant messenger with Microsoft’s in the first place…. *That* was what first brought Microsoft into Yahoo’s Universe…. So now Yahoo will just have to lay back and get what it gets now.

WJ | May 25th, 2008 at 12:07 pm

Remember TWA

Maria Lachapelle | June 4th, 2008 at 12:59 pm

Yahoo!’s Yang Earns His !
4/06/2008

Exclamation points should be reserved for the rarest of occasions and the unfortunate use of that little bugger after Yahoo!’s name has been a point of consternation to me. But today, I grant Jerry Yang, the 39 year-old CEO of Yahoo!, the right to use ! with impunity.

Why the sudden change of heart?

Yesterday I read that two Detroit pension funds are suing Yahoo! over its failed deal with Microsoft because they claim the proposed compensation plan in the last proposal was too expensive. That is funny on so many levels. The pension funds contend that the plan creates an “incentive for massive employee walkout,” as though we’re talking about a Teamsters strike in a Miller brewing plant.

Yang, it seems, had the foresight and smarts to develop a plan that would protect the interests of his employees in the event the deal was inked. Now this is leadership.

Yang should be applauded for looking out for the best interests of his people if their jobs are diminished or eliminated—and even more curiously—if they leave on their own accord. Imagine Microsoft having to keep folks on board after a deal—or worse—having to keep them happy so they hang around. What would Wall Street say?

I’m Maria Lachapelle, SVP at Mullen PR; I cut my teeth doing communications for M&As in NYC during the 1990s. It wasn’t unusual for management teams to spend the majority of their time working with us to explain the positives of the business combination, but only 10 minutes at 2 in the morning deciding the fate of tens of thousands of employees.

Here’s why Yang’s plan is good business for both Yahoo! and Microsoft. As soon as they smell blood in the water, Yahoo!’s best strategists, technicians, sales & marketing folks—who are eminently marketable—will jump ship, probably going to competitor Google. Nervous employees look for other jobs. Take that worry out of the equation and they stay focused on performing, competing, being the best.

And now that heavyweights Carl Icahn and T. Boone Pickens are threatening to oust Yang for sticking to his guns on the plan, the communications teams at Microsoft might want to take care that Yahoo!’s talent pool doesn’t exit along with Yang.

What role do you think CEOs should play in protecting their employees when inking deals?

Tags : Acquisition, CEO, compensation, failed deal, flight of talent, Icahn, lawsuit, Microsoft, pension fund, Pickens, Yahoo!, Yang
Categories : leadership
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