May 15, 2008
Wall Street’s big Yahoo hope: If anyone can, Icahn can
Carl Icahn might well have a better chance of bringing Yahoo and Microsoft together than Steve Ballmer ever had of doing it on his own.
That’s the message the Yahoo stock price has been screaming. With the activist investor mounting a proxy fight, Yahoo’s shares now actually stand higher than they did on several days when Microsoft was still pursuing its unsolicited bid.
Is this rational? Two things suggest it may be.
One is that it took Microsoft to drop its takeover offer for some of Yahoo’s biggest shareholders to show their hand. Remember that Bill Miller, who controls 6 per cent of the stock, had been publicly calling on Microsoft to pay $40 a share: once Steve Ballmer balked, Miller’s comments suggested he’d have taken $34 after all. Gordon Crawford, also with 6 per cent, said something similar.
This is valuable information to an investor like Icahn. Potential sellers don’t normally put their cards on the table quite so publicly.
The other reason to believe a deal has a better chance with Icahn on the scene is his track record in oiling the wheels of difficult negotiations. Exhibit One is the resolution of Oracle’s bid for BEA Systems earlier this year. With BEA publicly holding out for $21 a share, Oracle actually walked away from its offer of $17 a share: the deal (with Icahn acting as broker) eventually got done behind the scenes at $19.375. This was a bigger gap to overcome than the difference between Microsoft and Yahoo, as one investor in takeover stocks points out.
The big risk for the hedge funds that have been piling into Yahoo’s shares this week is that Microsoft can’t be brought back to the negotiating table. Having wasted three months and considerable credibility already, though, it seems almost unimaginable that Ballmer wouldn’t come back - at the right price.
Yahoo’s elected Board members have every right to do as they see fit for the long term lift of their company stocks , most are stockholders too…
Icahn and the crying and suing legal vampires are insisting on giving orders to MS to continue their push to buy Yahoo, that’s absurd and smells of extortion with a white glove…
Take Verizon Wireless,per example, which offers only instant -messaging from Yahoo,MS and AOl, if MS gets Yahoo, and TW makes the foolish mistake of selling AOl, the consumers are stuck with only one choice for video instant messaging : MICROSOFT, and where is the Anti-Trust PEOPLE? somewhere in the pocket of MS ? inside the gossip of News Corp. ? where are the consumer’s rights? how can the regulators leave the consumers with only one choice of IM ? how can they do that?
this is all a farce to let the “litigation professionals” get a piece of the pie and for some others to control all our options of IM, that’s all.
Posted by: blogger | May 16th, 2008 at 9:41 pm | Report this commentYahoo’e CEO & the so-called independent board needs to put their money where their mouth is. It’s stocks have been sinking like a stone except in the last quarter because of some one-time-deal in some Asian market. With deep pockets & renewed push, MS will knock out Yahoo from the #2 slot. That will be good enough for MS for the time being & as bad as it can get for Yahoo.
Posted by: Irfan Khayal, Dubai, UAE | May 19th, 2008 at 1:25 am | Report this comment