Legg Mason: We're backing Yahoo

Legg Mason Capital Management said Friday it will back Yahoo's existing management at the company's shareholder's meeting next month.

The investment firm controls about 60.7 million shares of Yahoo, which represents about 4.4 percent of outstanding Yahoo stock.

Investor Carl Icahn has proposed an alternative slate of board members, as part of a bid to get Yahoo to agree to some sort of takeover or deal with Microsoft.

"We believe the current Board acted with care and diligence when evaluating Microsoft's offers. We believe the Board is independent and focused on value creation for long-term shareholders," Bill Miller, chairman and chief investment officer of Legg Mason said in a release. But the investment house did say that it supports continuing efforts to negotiate.

"We would prefer that the company and Mr. Icahn reach a mutual agreement on the composition of the Board and end this disruptive proxy contest," the statement says.

Icahn is backing a change of management in part because he does not think Microsoft can negotiate with the current board. But Legg Mason said that is an unacceptable reason to change management.

"While boards are there to protect shareholder interests, shareholders own the company. If Microsoft wants to acquire Yahoo, it can make the terms and conditions of its offer public. If Yahoo shareholders support it, I am confident the Board of Yahoo will accept it," Miller said in the statement.

[jamalystic]

Why is Microsoft prodding Icahn to underming the current Yahoo board is really unethical. Google didn't even to pull any plugs when they strike their deal with Yahoo. It seems microsoft is so desperate to increase its online status that it is resorting to all these unethical tactics. It seems the online market just does not favor microsoft: Microsoft's Online Future: Forecast Hazy(http://www.internetevolution.com/author.asp?section_id=466&doc_id=152918&F_src=flftwo)

[jamalystic]

Why is Microsoft prodding Icahn to underming the current Yahoo board is really unethical. Google didn't even to pull any plugs when they strike their deal with Yahoo. It seems microsoft is so desperate to increase its online status that it is resorting to all these unethical tactics. It seems the online market just does not favor microsoft: Microsoft's Online Future: Forecast Hazy(http://www.internetevolution.com/author.asp?section_id=466&doc_id=152918&F_src=flftwo)

[jamalystic]

Why is Microsoft prodding Icahn to underming the current Yahoo board is really unethical. Google didn't even to pull any plugs when they strike their deal with Yahoo. It seems microsoft is so desperate to increase its online status that it is resorting to all these unethical tactics. It seems the online market just does not favor microsoft: Microsoft's Online Future: Forecast Hazy(http://www.internetevolution.com/author.asp?section_id=466&doc_id=152918&F_src=flftwo)

[jamalystic]

Why is Microsoft prodding Icahn to underming the current Yahoo board is really unethical. Google didn't even to pull any plugs when they strike their deal with Yahoo. It seems microsoft is so desperate to increase its online status that it is resorting to all these unethical tactics. It seems the online market just does not favor microsoft: Microsoft's Online Future: Forecast Hazy(http://www.internetevolution.com/author.asp?section_id=466&doc_id=152918&F_src=flftwo)

[jamalystic]

Why is Microsoft prodding Icahn to underming the current Yahoo board is really unethical. Google didn't even to pull any plugs when they strike their deal with Yahoo. It seems microsoft is so desperate to increase its online status that it is resorting to all these unethical tactics. It seems the online market just does not favor microsoft: Microsoft's Online Future: Forecast Hazy(http://www.internetevolution.com/author.asp?section_id=466&doc_id=152918&F_src=flftwo)

[darkr]

"Why is Microsoft prodding Icahn to underming the current Yahoo board is really unethical. Google didn't even to pull any plugs when they strike their deal with Yahoo."

thats cause yahoo was desperate to increase it's value in face of a buyout by promising 2x the reverenue by 2010 they didn't need to prove to google anything but they needed to prove to MS and yahoo's shareholders that it was worth 37bucks a share which sadly noone is falling for

[marc_90292]

I am glad Mason understands the industry sufficiently to see Icahn for what he is: a guy with a reverse Midas touch. Whatever he touches loses 15% of its value - make that 50% if you are lucky, and think of TWA which he ran into the ground

[i_made_this]

Bill Miller is one heck of a smart guy who understands tech investing. The market listens carefully when he talks about a major Legg position in play, in a way that the market doesn't listen to Carl Icahn. Miller had to acknowledge Icahn's recent market interference and "grant him" one or two seats on the Yahoo board just to put him in place. That's what this announcement's all about.