Legg Mason suggests $33 a share for Yahoo
Yahoo's third largest investor offered up some advice Tuesday to dissident shareholder Carl Icahn on what it may take to swing investor votes his way in a proxy fight, according to a Reuters report.
Legg Mason portfolio manager Bill Miller had this observation to offer to Reuters, when queried on whether he would support Icahn's proxy fight to unseat Yahoo's board of directors at the company's August 1 shareholders meeting:
The difficulty with Icahn is he'd have more shareholder support if he would say he wouldn't sell the company for less than $33.
What is the magic number for Carl Icahn?
(Credit: CNET News)Earlier this week, Icahn's proxy fight got a boost when Microsoft announced it would be willing to renew its buyout bid for all of Yahoo, or just its search assets, with a "new" Yahoo board.
Icahn and Microsoft, however both stated they were unwilling to discuss the details or price of any transactions that Microsoft may propose to a new board.
Said Icahn in his statement Monday, referring to Microsoft CEO Steve Ballmer:
I hope to continue to be speaking to Steve over the next few weeks; however, since I do not yet represent the Yahoo board, both Steve and I do not wish to get into details over price, or even which of these transactions makes the most sense.
Much has been said about how badly the Yahoo board has "botched up" negotiations with Microsoft over the past months. There is no need to keep pointing out the mistakes I believe Yahoo made by not immediately taking a $33 offer made by Microsoft.
Microsoft withdrew its sweetened unsolicited buyout bid in May, after Yahoo countered with a request for $37 a share, and failed to strike a partial deal for just Yahoo's search business in June.
As Miller calls on Icahn to issue a statement that he would not be willing to sell Yahoo to Microsoft for anything less than $33 a share, the portfolio manager may want to recall similar advice Icahn had given to Yahoo in early June.
Icahn, in a letter to Yahoo chairman Roy Bostock, had stated:
In my opinion, Microsoft does not believe you will ever sell the entire company on a friendly basis. So why don't you stop dancing around the subject and publicly offer to sell the company to Microsoft for $34.375 per share and promise to cooperate completely?
But, of course, that was a different time, a different era, in the five-month saga between Yahoo can Microsoft. That was a time when Microsoft was still willing to negotiate with Yahoo.
Now, as Microsoft said Monday in its statement of support for Icahn's proxy contest:
We have concluded that we cannot reach an agreement with them. We confirm, however, that after the shareholder election Microsoft would be interested in discussing with a new board a major transaction with Yahoo such as either a transaction to purchase the "Search" function with large financial guarantees or, in the alternative, purchasing the whole company.
Shares of Yahoo were down slightly in morning trading, nearly off 1 percent at $24.44 a share.
Dawn Kawamoto covers enterprise security and financial news relating to technology for CNET News. E-mail Dawn. 
Nath
http://www.themostpowerfulcompany.com
As much as I realize the contribution that Microsoft has made, I also recognize that Microsoft is not a "people" company and neither is it user friendly, especially in the way that Yahoo! is.
Just look at the way they are currently trying to force their new operating system on their customers while it's still having various and sundry major flaws; and that's just the latest and one of the smallest issues. They are too arrogant and too uncaring about client issues for anyone to be comfortable with them taking over Yahoo! and keeping it a "people" company.
They wouldn't know how. They wouldn't know how to cater to the type of people who use Yahoo! and who are a totally different animal from the people who would use Microsoft under similar circumstances, if any could be found.
Selling Yahoo! or any part of it to Microsoft would be ruining Yahoo! for its clients and a travesty to all.
To each its place, and a place for each. Microsoft, leave well enough alone.
- by Sugiarto Setiabudi July 9, 2008 2:21 PM PDT
- Carl Icahn and Steve Ballmer are playing "soap opera" in discussing of illegal hostile take over by various deceptive devices. which will have impact to the price sensitive information of Yahoo common share and its derivative such as options,CFD etc.
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(4 Comments)Yahoo an Microsoft are publicly traded companies,so only the legitimate persons who have discretion power in discharging corporate strategy.
Secret deal between Carl Icahn and Steve Ballmer shall constitute to abusing securities market,especially derivatives market due to Carl Icahn has long position of Yahoo shares.
Carl Icahn and Steve Ballmer should be held personally liable in breaching standard of care in securities market
Carl Icahn and Steve Ballmer are acting beyond the scope of their rights and disregarding market integrity and public trust .