From Silicon Alley Insider: Yahoo’s (YHOO) board responded to Carl Icahn, who is circling Yahoo like a hungry shark. Earlier, Icahn unveiled his slate of directors, including himself, Frank Biondi, and Mark Cuban. In a letter to Icahn, Yahoo Chairman Roy Bostock says he thinks the board is doing its job just fine–and, more importantly, he explains why.
In fact, Icahn’s attack has given Yahoo the best forum it has had to date in which to tell its story of the Microsoft negotiations–a story that it botched in the press the first time around. (In the days after the deal fell apart, Yahoo sounded wimpy, whiny, and clueless. In this letter, the company sounds diligent and reasonable.)
Most importantly, Yahoo’s letter will likely do what it is intended to do: Put the onus on Icahn to get a Microsoft offer back on the table. Bostock reiterates the company’s willingness to sell for $37 and notes that “there is currently no acquisition offer on the table from [Microsoft] or any other party.”
What will happen next? Icahn will probably try to get Microsoft to agree to pay $33 if he can deliver Yahoo in a gift-wrapped box. Importantly, however, we don’t think getting this agreement will be a given: We think that, for a variety of reasons, Steve Ballmer eventually decided that buying Yahoo was a mistake. (And we think he’s right).
If Icahn is able to get the Microsoft nod, however, he will circle the wagons with other Yahoo shareholders. Then he’ll turn up the heat on Jerry Yang and the board by waving the proxy stick and leaking the $33 publicly.