Microsoft Preps For Board Coup Of Yahoo
February 19, 2008 at 12:03 PM (PT)
Apparently, MICROSOFT hasn't taken too kindly to YAHOO's rebuff of its acquisition advances, let alone YAHOO's flirting with NEWS CORP. and AOL (NET NEWS, 2/18). Although founder BILL GATES told the press that it won't raise its $44.6 billion takeover bid, the NEW YORK TIMES reports the software giant is about to turn the screws on YAHOO's executive hierarchy.
The TIMES reports that MICROSOFT will initiated a proxy battle for YAHOO to get its shareholders on its side. If YAHOO's board still refuses to negotiate, MICROSOFT will try to nominate a new batch of directors on MARCH 13th. The company is willing to spent anywhere from $20-$30 million to engineer the proxy revolution.
Meanwhile, various interested parties have been mouthing off to the press on what should happen next.
LEGG MASON analyst BILL MILLER, who's YAHOO’s second-biggest investor, told THE GUARDIAN that MICROSOFT should up its offer. The paper also reports that fund manager ROBERT OLSTEIN, who owns 1 million MICROSOFT shares, sent a letter to CFO CHRIS LIDDELL, demanding that "Under no circumstances should you raise your price."
The hostile takeover bid could get really ugly, as YAHOO seems to be particularly vulnerable to a proxy battle, as The NY TIMES notes, "All of the Internet company’s directors are up for nomination this year ... and in a contested election, directors are elected by a plurality of votes cast."
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