Yahoo! seeks shareholder support, criticizes motives of 'corporate agitator' Carl Icahn

By Lisa Kerner

Charlotte, N.C., July 17 - Yahoo! Inc. asked its shareholders to support the company's current board of directors, and not Carl Icahn's dissident slate, at the annual meeting on Aug. 1.

Chief executive officer Jerry Yang and chairman Roy Bostock, in a letter to shareholders, accused Icahn and Microsoft Corp. of making misleading statements about their plans for Yahoo!

Yang and Bostock believe the Icahn/Microsoft alliance will destroy stockholder value at Yahoo!

According to the letter, Icahn, a well-known "corporate agitator," bought Yahoo! stock two months ago for an estimated average cost of less than $25 per share, giving him "a strong incentive to strike any deal with Microsoft" to recover his investment.

Yahoo! said it remains clear about its position, in contrast to what it called "conflicting and confusing statements" from the Icahn and Microsoft camp.

In the letter, Yahoo! reiterated its position:

• Sell Yahoo! in its entirety to Microsoft for $33 per share or more in a transaction that delivers certainty of value and closing;

• Remain open to selling only the search assets to Microsoft if it would provide value to Yahoo! stockholders and resolve operational risks related to separating the search and display businesses; and

• Examine all value-creating steps, including a potential spinoff of the company's Asia assets and a return of cash to stockholders.

It was previously reported that Icahn said if elected to Yahoo!'s board, he and the new board will:

• Immediately start negotiations with Microsoft to sell the whole company or, in the alternative, sell the search assets; and

• Move to replace Yang with a new CEO.

In June, Yahoo!, a Sunnyvale, Calif., internet services company, announced that its discussions with Microsoft regarding a potential transaction had ended.

Microsoft withdrew its proposal to acquire Yahoo! for $31 per share, or some $44.6 billion, in May after Yahoo! failed to move toward accepting the Redmond, Wash., software company's increased offer, according to a prior news release.

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