Microsoft Backs Ousting of Yahoo Board
SAN FRANCISCO (AP) — Microsoft Corp. threw its weight behind investor Carl Icahn’s effort to dump Yahoo Inc.’s board, saying Monday that a successful shareholder rebellion would encourage the software maker to renew its bid to buy Yahoo’s Internet search engine or possibly the entire company.
The unexpected endorsement gives Icahn a carrot to dangle before Yahoo shareholders as he wages an acrimonious campaign to replace Yahoo’s nine directors at the company’s annual meeting Aug. 1.
It marks the first time that Microsoft has publicly sided with Icahn since the billionaire investor launched his attempted coup nearly eight weeks ago.
Microsoft more recently has been trying to pry away Yahoo’s search engine for $1 billion, plus an additional $8 billion investment for a 16 percent stake in Yahoo’s remaining operations.
Yahoo instead opted for an online advertising partnership with rival Google Inc. that is supposed to boost its annual revenue by $800 million. That alliance faces an antitrust review by the U.S. Justice Department because Google and Yahoo combined control more than 80 percent of the U.S. search advertising market.
In its Monday statement, Yahoo asserted Microsoft is trying to use Icahn to engineer a purchase of Yahoo’s search engine in a deal that would hurt the company in the long run, by hindering its ability to compete in the Internet’s rapidly growing ad market.
– from the Associated Press