Another Icahn Letter to Yahoo (YHOO): Yawn. Carl Shooting Blanks
Reuters excerpt:
"While Google's income from operations grew 59 percent per year for the last two years, Yahoo's income from operations shrank 21 percent," said Icahn in his latest salvo to Yahoo Chairman Roy Bostock.
"What was the board doing during over this period? Where was their great plan? Why did you permit Google to leave you in the dust?"
Blah, blah, blah. Old news, Carl. Like waving a plastic gun in Jerry's face with a banner that pops out and says "BANG!"
See Also:
Sorry, Carl, We're Not Voting For Your Proxy Slate
Icahn's Latest Letter Reveals His "Plan" For Yahoo
This maybe old news that he's spewing out but its all to relevent at this juncture. Most shareholders are not going to leave things pro quo and watch their shares drift into the teens again.
Yahoo's current management blew the Microsoft deal, but the company's current situation is largely Terry Semel's responsibility and he's already gone.
Hopefully they are working behind the scences as we speak on who will be new management although those things can take some time.
Also the estimates for the other alternatives beside the MSFT full acquistion seem that they should be based on a starting point of around $22 per share or less. The only reason YHOO trades at $26-27 is because of the potential MSFT sale. Some analysts say that a partial deal could add up to $9 per share thus more than $33. I think that logic is flawed and the $9 per share addition would be from $22 at most (if the MSFT bid never came into play Yahoo would probably be below $20).
a - if ever there was a ceo and board deserving of ejection, it would be these guys (for the msft deal alone but certainly for long-term performance as well)
b - icahn's plan isn't any worse than jerry & sue's
you say i-con's plan is is no worse then jerry's?
please tell me, what is i-con's plan (besides selling to msft?)?
Henery, take into perspective that it was YHOO BOD and Yang that have made several HUGE blunders for us shareholders.
#1: Choosing not to purchase GOOG in 2000 for $1 billion. We all know what happend next...
#2: Choosing not to buy Youtube...again we all know what happend next....
#3: Rejecting MSFT bid of $40 p/s back in '07...we all know what happend next -- YHOO traded down to $18.
#4: Rejecting MSFT bid of $33 p/s...we all know what will happen if they dont close a deal soon.
And of course, how can we forget the all hyped Panama -- touted the GOOG killer. $2 billion wasted on a platform that Management was ready to outsource to GOOG!
The list can go on and on. YHOO needs to understand that the day of the dot com bubble has passed and that they need to act like a real company in order to survive.
his plan depends entirely upon msft (or maybe a goog alliance). he is depending on what other co.s may do, not what yhoo will do. and that sounds pretty flimsy to me.
firing a few "morons" is not a plan.
I-con has lost his edge. His glory days are long behind him.
glory days? i've got a couple of glory days for you:
1. jan 3, 2006 - yhoo hit 43.21.
2. jan 30, 2008 - yhoo hit 18.58.
i don't care how flimsy you think icahn's plan is - it's tough to get flimsier than current yhoo management's performance. or did you want to see the stock hit single digits before you're ready to see them go?
If it wasn't for Carl barking like a dog, then Yahoo would have sunk to $19 and stayed there. But the stock is at $26.50 and I've made lots of money on the way up.
Assuming that Carl wins the proxy battle, Yahoo's stock will peak and then as the weeks drag on without a Microsft bid over $25, the stock will erode back down to $22. I will make a ton of money on the way down.
I love Carl. Look at what he achieved with Blockbuster. If you sold short when he took over, you would have made a fortune too.
The decline has been substantial making any offer above $31 per share even less likely, given the increased dilutive effect since MSFT's stock is at $27.50 vs when the stock was at $34.
Yes MSFT probably needs YHOO or some component of Yhoo but given the even larger dilution the price that YHOO may fetch is probably topped at $31 or even less.
Where the hell are these ad partnership/other deals with either Microsoft or Google?
In my opinion, he is only willing to pull the trigger when his back is to the wall from shareholder pressure. Two weeks ago, an agreement was pending.... now, where is it???
I couldn't agree more. If MSFT and Icahn go away I doubt a Google deal is ever announced.
Outside of your universe - here is what many who are in the acquisition business relate to the situation.
1. Jerry Yang is hanging himself slowly and twisting
2. His moves along with the other executives are things learned in a sandbox and usually left behing when entering the junior world.
3. The end of the Board, Henry Blogett's opinion,etc. is a forgone conclusion
4. Ever watch a tennis game where one player stands in the middle of the court hardly moving, while he runs his opponent from side to side - until the opponent finally falls apart - crashes his racket to the ground - and scrapes himself all over. Karl Icahn has assumed the position of the player standing in the middle of the court - taking his time until his opponent self destructs.
Grow Up! Ichan is a Master - your ignorance cannot even see it - Watch Jerry - take it up the ass.
Why did the master fail so miserably with Blockbuster?
Icahn, hedge funds and many investors lost most of their money.
I made a list of Icahn's recent successes once gaining control of the board:
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@Paul - Don't forget SAI receives payment from Yahoo. It's no longer in Henry's interest to bash the company.
In other words, market commentary seems at present to focus almost entirely on Aug 1 and the proxy contest, but it's really hard for me to see why negotiations with MSFT would take nearly that long.
If we can have any confidence in the "sources close to" leaks from last week (or the week before, I can't remember) in which they anticipated the completion of talks reasonably soon, then those negotiations ought to be nearing conclusion for one outcome or the other. I mean, it's not like they're putting a man on Mars.
It's beyond my comprehension that either MSFT or Yahoo would continue the limited deal negotiations more than another 10 days or so.
Does Bostock and Yang just intend to play freeze-tag with Icahn, day after day and week after week all the way until Aug 1 without taking some committed action of their own?
An anouncement of a partial deal with Microsoft will surely come attatched with some other deal, ie. 3rd party, that makes a good case for a valuation of Yahoo at $31 plus.
The latest sources that I know of leaked to the Wallstreet Journal that it should come this week.
2. I feel that when the package gets to court it will have a Crocodile Dundee better than average chance of getting voided by the court.
3. Carl is not married to the company, and is looking at it from a business perspective. If Yang and Co wanted to protect their child then they should not have taken the company public. But then they would not have been among the hot to trot silicon money boys. Sorry guys you can't have it both ways.
Your example doesn't make sense, and you don't provide "young talent's" basis for collecting change of control severance benefits. If he does, you'll have to show us how he does.
I've just read the entire filing Yahoo made in answer to various questions about the plan. You can find it here (DEFA14A filed 6/10/08):
http://yhoo.client.shareholder.com/sec.cfm?DocType=
I find the most unique part of the Q&A to be the part where they discredit the plaintiffs' "that's nuts" contention included in the complaint filing that Icahn referenced. If all that had to be done to win a case is to file a complaint, we wouldn't need judges or courts, now would we?
From that filing you can take "young talent" and try to find out how to get him a severance benefit. But I'd suggest that young talent not count his chickens too soon. He needs to think "Camry" instead of "BMW" until he works through the controlling terms and lingo.
chatchat