After a tumultuous year-long adventure trying to influence the management of Yahoo, Carl Icahn, the Wall Street billionaire gadfly, has resigned from the company's board. After wading into Microsoft's $47.5 takeover attempt on Yahoo last year, Icahn, who owns about 5 percent of Yahoo shares, said in a letter to the board that he was focused on other matters -- most notably perhaps, his large debt-stake in CIT -- and as a result, "I do not presently have the time that is necessary to devote to the business and affairs of Yahoo."
As Icahn exits the Yahoo stage, the corporate raider can claim no great victory -- Yahoo shares are hovering where they were when Icahn became involved with the company's governance last year.
"When I joined the board, the company was in a state of turmoil," Icahn said in the letter. "In the period since then, we have all worked together to achieve much for the company, most notably bringing Carol on to be the CEO and then consummating the search deal with Microsoft."
Icahn joined Yahoo's board in August 2008 in the midst of a bitter takeover assault by Microsoft, which in February 2008 had offered $47.5 billion to buy the company. Icahn had been upping his stake in the company, and as he has in the past, agitated his way into a board seat. His goal? Completion of the Microsoft deal, or if not that, a search partnership with the software giant.
In fact, what Icahn really wanted was what he always wants. More money. Microsoft's final $30 per share offer for Yahoo represented a huge premium to the average price where Icahn bought into the company, thought to be in the $17 range, although some of his shares were surely purchased at a lower price.
Yahoo's Friday closing price on Friday: $17.22.
Icahn succeeded in getting then-Yahoo chief Jerry Yang to run into Microsoft's arms. But by that time, Microsoft boss Steve Ballmer -- offended by Yang's earlier snubs -- had taken his marbles and gone home, rescinding his final offer. Yahoo was left to twist in the wind, and Yang fell on his sword by resigning. He had no choice. Yahoo had decisively lost the search wars to Google, the web ad juggernaut, and its corporate strategy was incoherent. Employees were bailing out faster than rats on a sinking ship.
After Yang's downfall, Carol Bartz was named as CEO, and she notched a nice quarter last week with Yahoo's income more than tripling to $186.1 million as she seeks to turn around the company. Bartz's first order of business upon taking over was completing a 10-year search partnership with Microsoft. The Justice Dept. is currently reviewing the antitrust implications of such a deal.
"Carol is doing a great job and I believe the Microsoft transaction will provide great long-term benefits, the potential of which many still do not understand," Icahn said.
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