Kara Swisher

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Not With a Bang, but a Whimper: Icahn Leaves Yahoo Board (Plus His Entire Letter)


Carl Icahn, the activist billionaire investor who made such a noisy fuss in his quest to force management and other changes at Yahoo, is taking a much quieter leave from the Internet giant’s board.

He apparently has told the Yahoo (YHOO) board that “there was not a need at this time for an activist investor” and that he has a lot of other companies he invests in to focus on.

That’s true, of course, given a spate of troubled investments that Icahn is dealing with.

But here’s BoomTown’s quickie analysis: Yahoo CEO Carol Bartz completely ignores him.

In fact, Bartz often has gone out of her way to take little gibes at Icahn since she got the top job in January, whether it’s to say he called her too much or that he could try to fire her if he did not like the job she was doing.

For example, she just dissed him publicly in a piece in Forbes, tossing off a saucy insult:

“Icahn is just another shareholder. What’s he going to do, fire me?”

But Yahoo was cordial to Icahn as he departed, even if a lot of people at the company who had battled him were likely thinking: “Don’t let the door hit you on the way out!”

“Carl has been an important member of our Board and has helped us through some significant transitions,” said the Yahoo statement. We are all grateful for his active role shaping the future of Yahoo! and wish him well in all his endeavors.”

Icahn in the second board member to leave under Bartz’s tenure.

Frontier Communications (FTR) CEO Maggie Wilderotter announced in late September that she was stepping down from the board by year’s end.

It will be interesting to see who–if anyone–will comes on board as a director and, of course, if there are more departures. After the departures of Wilderotter and Icahn, there will be 10 directors.

(Here is BoomTown’s No. 1 pick still in that regard.)

In taking his leave, Icahn praised the recent search and online advertising deal Bartz struck with Microsoft (MSFT), noting that it will “provide great long-term benefits, the potential of which many still do not understand.”


Nice final toss to try to spike the stock, Carl! But the MicroHoo deal, which has yet to be approved by regulators, was likely cold comfort for him.

Icahn sank large sums of money in Yahoo with hopes of a big score via the hostile takeover attempt by Microsoft at a price upward of $30 a share.

After that deal tanked, Icahn has seen his stake decline in value.

He sold 16 percent of his Yahoo shares in late August, leaving him with a 4.5 percent stake, or about 63 million shares.

It is also not clear today if Icahn intends to unload more of the stock.

In 2008, he couldn’t buy enough, scooping up the stock at much higher prices.

After mounting a proxy fight–including the lobbing of a series of poison-pen letters–against former CEO and co-founder Jerry Yang and his management team, Icahn got board seats for himself and two others (John Chapple and Frank Biondi) in July of 2008.

As Digital Daily’s John Paczkowski put it perfectly then:

“Having so persuasively argued that Carl Icahn is a doddering Luddite with no articulated plan for Yahoo other than the company’s sale to Microsoft, Yahoo has taken the logical next step and appointed the activist shareholder to its board of directors.”

At the time of the fighting, Yahoo used a quote from Icahn to insult him: “It’s hard to understand these technology companies.”

In a way, that is a pretty accurate description of Icahn’s long wrangle with the Silicon Valley icon.

And, while some might not agree with my take, this is the way the Yahoo world ends for Icahn: Full of sound and fury, signifying nothing.

Here is Icahn’s entire letter to the Yahoo board:

To the Yahoo! Board of Directors:

I am hereby tendering my resignation as a director of Yahoo! to take effect immediately.

When I joined the Board, the company was in a state of turmoil. In the period since then, we have all worked together to achieve much for the Company, most notably bringing Carol on to be the CEO and then consummating the search deal with Microsoft. I am proud to have played a role in both these decisions. Carol is doing a great job and I believe the Microsoft transaction will provide great long term benefits, the potential of which many still do not understand.

I don’t believe that it is necessary at this time to have an activist on the Board of Yahoo! and currently, my attention is focused on other matters. As a result, I do not presently have the time that is necessary to devote to the business and affairs of Yahoo! required if a board member is to fulfill his fiduciary duties to the shareholders

Again, I want to thank the members of the Board for acting so responsibly during my tenure. I look forward to maintaining my relationship with each of you.


Carl Icahn

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There was a worry before I started this that I was going to burn every bridge I had. But I realize now that there are some bridges that are worth burning.

— Valleywag editor Sam Biddle