Yahoo CEO Carol Bartz Out; Replaced by CFO Tim Morse
The news comes as the Internet company considers multiple options, including going private.
Carol Bartz is out as CEO of Yahoo, replaced on an interim basis by CFO Tim Morse, the company said Tuesday.
Bartz was hired as CEO of Yahoo in early 2009 and the next year, when her compensation topped $47 million, shareholder advisory firm Glass Lewis & Co. named her the “most overpaid” CEO in the country, which didn't go over well with investors and spurred rumors that some Yahoo board members were already regretting their choice.
Bartz "has been removed by the board from her role as chief executive officer," Yahoo said in a statement issued late Tuesday.
AllThingsD, which first broke the news, reported Tuesday that co-founder Jerry Yang and other board members were disappointed in Yahoo’s sideways-moving stock price since Bartz took over, and that big companies are interested in acquiring Yahoo. Among those named were News Corp. and, separately, an investment group that includes former News Corp. executive Peter Chernin.
Yahoo shares were up slightly Tuesday to $12.91 on twice the normal volume, and in after-hours trading when the AllThingsD report surfaced they jumped 6 percent higher.
Yahoo was founded in 1994 by Yang and David Filo and was one of the frothiest stocks during the Internet bubble that burst about seven years later.
Just before the bubble popped, Yahoo shares were so valuable that analysts and investors were encouraging the company to use them to purchase Disney. On Tuesday, though, Disney’s market capitalization of $60 billion dwarfed Yahoo’s $16 billion valuation.
In 2001, former Warner Bros. co-CEO Terry Semel was named CEO of Yahoo and he reportedly earned $450 million from stock options during his six-year tenure, even though he presided over Yahoo during the years when Google overtook it as the Internet’s top search destination. Google, which Yahoo under Semel once tried to buy for $1 billion, is now the Internet's most valuable company with a market cap of $169 billion.
On Tuesday, AllThingsD founder Kara Swisher wrote that options such as selling the company outright, taking Yahoo private or splitting it up in parts have been discussed by its board of directors.
“There have been increasing signs of late that Yahoo’s board is ready to listen to any serious offers,” Swisher wrote.
"We are committed to exploring and evaluating possibilities and opportunities that will put Yahoo on a trajectory for growth and innovation and deliver value to shareholders," said chairman Roy Bostock on Tuesday.
Bartz, known for her candor (including a public obscenity every now and then), sent a memo from her iPad Tuesday, according to mashable.com, that read: "I am very sad to tell you that I've just been fired over the phone by Yahoo's chairman of the board. It has been my pleasure to work with all of you and I wish you only the best going forward."