Yahoo! Settles with Carl Icahn; Is This “Peace at Last?”

By Michael Santo
Editor-in-Chief, RealTechNews

Has the drama finally ended? According to a press release issued today, it seems that Yahoo! and Carl Icahn, who was seeking to replace much if not all of Yahoo!’s Board of Directors (BoD) during the upcoming August 1st shareholders meeting, have come to an agreement.

Much as with Icahn’s earlier fireworks with Motorola, he got much of what he wanted.

• The BoD will expand from 9 to 11.

• Icahn will get a seat on the BoD

• One member, Robert Kotick, will not stand for re-election, but the others, including oft-criticized (by Icahn) Jerry Yang, will.

• The remaining two seats will be filled from slate of nominees (since Jonathan Miller, former Chairman and CEO of AOL is listed in the PR, you can bet he’ll be one of them).

Much of the remaining portion of the press release falls into the category of science fiction, it seems.

For example, Icahn said:

“I am very pleased that this settlement will allow me to work in partnership with Yahoo!’s Board and management team to help the Company achieve its full potential. While I continue to believe that the sale of the whole Company or the sale of its Search business in the right transaction must be given full consideration, I share the view that Yahoo!’s valuable collection of assets positions it well to continue expanding its online leadership and enhancing returns to stockholders.”

Chairman Roy Bostock said:

“We are gratified to have reached this agreement, which serves the best interests of all Yahoo! stockholders. We look forward to working productively with Carl and the new members of the Board on continuing to improve the Company’s performance and enhancing stockholder value.”

And CEO Jerry Yang joined the love-fest:

“This agreement will not only allow Yahoo! to put the distraction of the proxy contest behind us, it will allow the Company to continue pursuing its strategy of being the starting point for Internet users and a must buy for advertisers. I look forward to working together with our new colleagues on the Board to make that happen.”

My guess is there was a lot of Listerine swigging to get the sour tastes out of their mouths.

Still, much of the drama is now gone from the upcoming shareholders meeting. While talks had been ongoing between the two sides, the support of Legg-Mason for the current Yahoo! BoD may have tilted the balance.

And if you think this is “peace at last,” you haven’t been checking to see how many of the above-mentioned people have been invested in body armor to protect against stabs in the back.