Yahoo board takes fire

A few pieces are detailing Carl Icahn’s foray into Yahoo and his decision to take up the proxy fight Microsoft appears to have abandoned. This Dealbook article gets my vote today because of this quote from Icahn:

It is unconscionable that you have not allowed your shareholders to choose to accept an offer that represented a 72 percent premium over Yahoo’s closing price of $19.18 on the day before the initial Microsoft offer.

Regular readers will remember that we raised this exact issue recently; the premium was so high that we think it likely that Yahoo’s board could not have avoided presenting the opportunity to shareholders, even if it recommended against acceptance. It would have been perfectly acceptable for the board to negotiate a transaction that provided for no breakup fee, a strong fiduciary out, and even limited Microsoft’s due diligence before signing up the deal to reduce Yahoo expenses. All of those make sense in terms of protecting Yahoo’s value without reducing freedoms or eliminating opportunities for shareholders. Not wanting the company to be acquired or or not wanting to work for Microsoft is woefully insufficient justification for the actions of the board and management. It’s not their company; it’s the shareholders’.