Tuesday, June 17, 2008
Yahoo's Future Flickr-ing
San Jose Mercury News reports that Flickr founders Caterina Fake and Stewart Butterfield are the latest in a string of executive resignations at Yahoo! Inc. Fake, who led the the effort to create Brickhouse, Yahoo's San Francisco-based startup incubator, will not be returning from maternity leave. Butterfield, her husband, who served as general manager of Flickr, will depart July 12. Among the executives who have left or will leave soon are Jeff Weiner, the executive vice president of Yahoo's network division, and Usama Fayyad, the chief data officer and executive vice president of research and strategic data solutions.
And as Jerry Yang celebrates (mourns?) his 1 year anniversary as Yahoo! CEO, the media is abuzz and betting that he won't make it to the next anniversary. Yi-Wyn Yen at Fortune sums it up devastatingly. Under Yang's watch, Yahoo lost 16.5% of its stock value and became a takeover target. Then he provoked shareholder ire by rejecting Microsoft's offer to acquire the company at $33 a share - a 72% premium. He faces shareholder lawsuits and activist investors like Carl Icahn, who is threatening to oust Yang and his board of directors. And a steady stream of talented executives and engineers are decamping for startups and rivals like Google.
To make matters worse, Icahn refuses to go away, even after Microsoft has made absolutely clear it is no longer interested in buying out all of Yahoo! Inc. Reuters report says that Yahoo Inc investors are showing more interest in an alternate board slate proposed by billionaire Carl Icahn. Mark Nelson, a partner at Mithras Capital, which owns about 1.7 million Yahoo shares, said he would back Icahn's entire slate unless the current board took a dramatic about-face.
The one bright spot for Yang and Yahoo's current and soon-to-be-former Board is that the Judge in the shareholder case against them is refusing to grant an early trial date in July. Bearing in mind that Yahoo's annual shareholder meet is on August 1 2008, a July trial contesting the legality of Yahoo's cooked-up severance plan would have virtually assured a blitz of negative publicity and brought even more shareholders into Icahn's camp. The Judge said that the plaintiffs hadn't shown good cause for it, and also added that he would rule on Yahoo's motion to dismiss the lawsuit before the meeting on August 1.
And as Jerry Yang celebrates (mourns?) his 1 year anniversary as Yahoo! CEO, the media is abuzz and betting that he won't make it to the next anniversary. Yi-Wyn Yen at Fortune sums it up devastatingly. Under Yang's watch, Yahoo lost 16.5% of its stock value and became a takeover target. Then he provoked shareholder ire by rejecting Microsoft's offer to acquire the company at $33 a share - a 72% premium. He faces shareholder lawsuits and activist investors like Carl Icahn, who is threatening to oust Yang and his board of directors. And a steady stream of talented executives and engineers are decamping for startups and rivals like Google.
To make matters worse, Icahn refuses to go away, even after Microsoft has made absolutely clear it is no longer interested in buying out all of Yahoo! Inc. Reuters report says that Yahoo Inc investors are showing more interest in an alternate board slate proposed by billionaire Carl Icahn. Mark Nelson, a partner at Mithras Capital, which owns about 1.7 million Yahoo shares, said he would back Icahn's entire slate unless the current board took a dramatic about-face.
The one bright spot for Yang and Yahoo's current and soon-to-be-former Board is that the Judge in the shareholder case against them is refusing to grant an early trial date in July. Bearing in mind that Yahoo's annual shareholder meet is on August 1 2008, a July trial contesting the legality of Yahoo's cooked-up severance plan would have virtually assured a blitz of negative publicity and brought even more shareholders into Icahn's camp. The Judge said that the plaintiffs hadn't shown good cause for it, and also added that he would rule on Yahoo's motion to dismiss the lawsuit before the meeting on August 1.
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