Carl Icahn resigns from Yahoo board of directors

Carl Icahn, who launched a shareholder insurrection at Yahoo last year over its handling of a takeover offer from Microsoft, is leaving Yahoo's board of directors.

MarketWatch reported Friday that Icahn has informed the company he's moving on to other interests. It's been a over a year since he forced his way onto the board after expressing his displeasure at Yahoo's rejection of Microsoft's offer to acquire the company, which at one point was valued at $33 a share. Yahoo's stock closed at $17.22 on Friday.

Yahoo confirmed Icahn's departure, and said in a statement: "Carl has been an important member of our Board and has helped us through some significant transitions. We are all grateful for his active role shaping the future of Yahoo."

Icahn has recently turned his famously wandering eye to struggling financier CIT Group, offering it a $6 billion loan. In a letter to Yahoo, he said "I don't believe that it is necessary at this time to have an activist on the Board of Yahoo and currently, my attention is focused on other matters." He expressed his support for CEO Carol Bartz and the pending search deal with Microsoft, two strategic decisions that he said he was "proud to have played a role" in bringing to fruition.

"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 wrote in the letter. His departure leaves Yahoo with 11 board members, which will decrease again to 10 when current director Maggie Wilderotter leaves at the end of the year.

[jackdaniels08]

I love these publicity spin statements. The art of total BS-ing. I had to write a couple letters regarding departure of business dealings with clients in more than one occasion and my supervisor would come in and totally gut the letter and put a nice phony face on it. But it is important to not allow emotions to dictate professionalism. In departures like this, you never want to publicly and even privately burn bridges but keep a hand extended.

[Goodbye Helicopter]

JackA$$ realized they didnt want him and he does not know a damn thing about the tech industry, let alone a web company.
Impudent 80's rich jerk.

[mbenedict]

Except that Icahn not only wants to leave on his own terms, he retains direct control of at least two remaining Yahoo board seats. He's no dummy. His agreement with Yahoo gives him the right to three board seats.

I think Icahn accomplished what he wanted to do, namely replacing Yang with Carol Bartz and closing the Microsoft deal.

[cvaldes1831]

Nah, he sold 12.7 million shares at less than $15 apiece recently. He acquired his stake at an average price of $25 meaning he has lost already $130 million. Since he still has a 4.3% stake in the company (60 million shares) which means it is likely he will lose more.

The Microsoft deal that closed was not the one Icahn wanted.

Most of the financial commentators are saying that Carl quit the board because he *didn't* get what he wanted, namely acquisition of Yahoo! at $33/share by Microsoft. The deal was doomed when the Legg Mason guy gave the thumbs down.

Basically he spent $130+ million to get Yang yanked as CEO.

Icahn rode into Silicon Valley like a cowboy and got the sh*t kicked out of him. He's an occasionally brilliant Wall Street financier who knows jack about high-tech and Silicon Valley culture.

[mbenedict]

Um, no.

Legg Mason / Bill Miller didn't "give the thumbs down" for a MS deal at $33/share. Are you kidding? They WANTED a transaction at $33, that was their whole position! MS offered $33 but Yang asked a ridiculous $37, which is his way of scuttling the deal. Ballmer walked, even when Yang later practically begged MS to come back to the table at $33 (not a smart move by Yang).

Icahn probably would've sold at $30 or even less. The deal was "doomed" when the financial markets collapsed. Everyone knew that. Ballmer was talking about "reset" and it was dead.

Bill Miller supported Yang throughout the proxy fight, and without Icahn at the board, Yang might still be CEO. After the market collapse, bringing in a replacement like Bartz and getting an MS search deal was the only realistic option. There's literally nothing left for Icahn to do.

Icahn selling 12.7m shares is a red herring. He is still Yahoo's 3rd largest shareholder and controls 20% of the board. His company owns 2.5x more YHOO stock than Legg Mason, valued at close to $1 billion at today's prices.

[cvaldes1831]

The fact of the matter is Icahn isn't making any headway and he's bored with the whole venture. Why not have three board seats instead of just two?

You think the other two Icahn board members are going to be activists now that Icahn's gone?

Icahn gambled and lost. In a way, he's smart because he's cutting his losses and getting out. It's happened before to him. He only sees companies as moneymakers or moneylosers. He doesn't give a rat's arse about what the company does, who the employees are, what the company's vision is.

He doesn't build, he destroys. When he can't destroy profitably, he cowers and leaves. Arch-bully, very dangerous person.

[cvaldes1831]

Oh, and Bill Miller gave the thumbs down to Icahn's ill-fated proxy fight.

[mbenedict]

Bill Miller gave the thumbs down _and lost_. Icahn got three board seats, ousted Yang, and got an MS deal signed.

And I don't see how Icahn is "cutting his losses" by leaving the vast majority of his YHOO shares intact!! He only sold 16% of his Yahoo holdings, which points to a diversification move rather than loss-cutting.

Icahn bought YHOO shares before the stock market tanked. So he's forced to sit it out for the long haul, or bail out completely.

[Jamie_Foster]

I consider Icahn as his elk as akin to Vultures. He would probably see that as a complement. However, on this occassion his involvement was the catalyst for positive things. Firstly Yahoo now has a very experienced and capable leader. Secondly the search deal has given Microsoft the spur to step up its R&D on search and online computing. So we will now have a viable alternative to Google both as consumers or as advertisers.

[Jamie_Foster]

Sorry I meant to write Ilk. Comparing Icahn to an Elk is insulting to an Elk.

[Renegade Knight]

On this occasion his involvement was a catalyst for the end of Yahoo as a viable company. Corporate raiding had a purpose. Breaking apart larger companies into smaller ones that overall did better alone than as part of a conglomerate. A lesson that could be applied to some of the mega companies today.

[PhaseDMA]

He didn't even accomplish the search deal. At least not yet. It still has to get past the FTC.

[pentest]

Icahn is a greedy moron that leaves untold damage in his wake.

[JCPayne]

Ofcourse he did. Yahoo's stock price is right back where it was pretty much when he got involved. So he has his inside 'girl' at Yahoo now who probably has the mandate to break up Yahoo and give away the rest of the revenue (ads) business to Microsoft.

[skane5]

Carol Bartz is hardly just Icahn's "girl". She was CEO of Autodesk for 14 years and during her tenure Autodesk was very successful. Jerry Yang and David Filo did a great job of creating Yahoo, but Yang wasn't trained as a CEO and had no management experience anywhere else. It's quite common for start-ups to bring in more experienced people when the company gets established. Yang was fortunate that he was able to remain CEO for as long as he did.

[JCPayne]

ICAHN is pretty bad at business. He wanted to merge Circuit City and Blockbuster. Both were on the verge of bankruptcy at the time too.

[QA_Tester]

Icahn understood one thing that is critical. Based on it's current business model Yahoo can't survive. Yahoo needs to start creating more cloud based services either through internal initiatives or by buying companies. Perfferably both. Acquiring Zoho would be great first step.