Icahn loads up against Yahoo
Biondi, Shaye, Cuban join corporate raider on his slate of dissidentsCorporate raider Carl Icahn has nominated an alternative slate of directors for Yahoo's board that includes such big industry names as Frank Biondi, Robert Shaye and Mark Cuban. Icahn himself is leading the dissident board nominees.
Icahn, in a letter to Yahoo chairman Roy Bostock dated Thursday, confirmed having bought a large stake in Yahoo and made official his intention to wage his latest proxy fight in the broader media and entertainment industry after a similar action against Time Warner a few years ago. His slate back then was led by Biondi, the former Universal Studios and Viacom CEO.
"It is clear to me that the board of directors of Yahoo has acted irrationally and lost the faith of shareholders and Microsoft," Icahn said. "It is quite obvious that Microsoft's bid of $33 per share is a superior alternative to Yahoo's prospects on a standalone basis."
Cuban, the founder of HDNet, has experience with Yahoo, having sold Broadcast.com to the online giant in 1999 for $5.9 billion, thus seeding the young exec with enough wealth to diversify his holdings and become a media mogul.
Cuban, Biondi and recently removed New Line Cinema CEO Shaye declined to discuss their roles in the Icahn slate.
Icahn, in his blistering letter to Bostock, said that talks with Microsoft were "botched" and that shareholders have asked Icahn to lead a proxy fight that will replace the current board with one that might be able to close a deal with Microsoft.
"It is unconscionable that you have not allowed your shareholders to choose to accept an offer that represented a 72% premium over Yahoo's closing price of $19.18 on the day before the initial Microsoft offer," Icahn wrote.
Bostock accused Icahn of laboring under "a significant misunderstanding of the facts" related to the Microsoft proposal. "The record of our efforts to engage Microsoft in meaningful discussions is unequivocal," he wrote.
Icahn said he acquired 59 million Yahoo shares for $1.5 billion since Microsoft abandoned its takeover effort, and he has asked that the Federal Trade Commission allow him to buy up an additional $1 billion worth, which would give him about a 4% stake. Co-founders Jerry Yang and David Filo together own about 10% of Yahoo.
Now all eyes will be focused on Yahoo's scheduled July 3 shareholders meeting, where Icahn's slate will compete for slots against Yahoo's current board.
Georg Szalai reported from New York; Paul Bond reported from Los Angeles.