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Icahn: Google/Yahoo deal OK if MS out

updated 10:55 am EDT, Fri June 6, 2008

Icahn on Yahoo Strategy

Billionaire investor Carl Icahn today responded to criticisms from Yahoo with a second open letter to the search engine giant. Addressing claims that he has no plans for Yahoo should Microsoft decline to make bid with a newly replaced board in office, Icahn says he would be willing to have Yahoo strike a search deal with Google as long as its terms would still allow a future Microsoft takeover. Icahn doesn't say whether this would still involve the proposed ad bidding system trialed earlier this year or a new plan altogether.

The investor nonetheless refuses to plan for less than a Microsoft takeover at $34.375 per share and intends to take several steps to ensure this happens, including dropping Yahoo's controversially expensive severance plan -- described by Icahn as a "poison pill" to discourage Microsoft -- as well as removing Jerry Yang from the CEO position and forbidding any partial transaction unless it nets at least the $33 per share Microsoft was offering for a takeover until it backed away from the deal. A high value for only a partial deal is unlikely and makes Icahn "skeptical," according to his letter.

The financial expert doesn't address other alternatives beyond the Google ad deal in his letter and also doesn't explain why he sees the Microsoft deal as necessary to Yahoo's future. The latter has resisted in part with claims that it foresees its recent profits continuing to grow in the next few years and thus giving it little need to sign a deal with Microsoft.

Microsoft had initially launched its bid in late January in an attempt to develop a viable rival to Google in search and search ads, but ultimately backed off after believing that Yahoo refused to accept a reasonable share price for a takeover. Yahoo in turn has maintained that it has been willing to negotiate but that Microsoft's official bids didn't assign proper value to Yahoo's assets.

by MacNN Staff



  1. Athens

    Joined: Dec 1969



    That guy is a jerk, who does he think he is.

  1. luckyday

    Joined: Dec 1969



    A guy who became the 46th richest man in the world by doing exactly what he is doing now.

    Now I think the better question is who do you think you are?

  1. Guest

    Joined: Dec 1969



    "I recently have acquired significant shares of Yahoo and I want to make some profit, no matter how small, as soon as I can."

  1. idanno

    Joined: Dec 1969


    say good-by to yahoo

    If this happens, yahoo will become MSN in the future.
    Yahoo will cease to exist.
    All things good about yahoo will disappear and it will become just another trashy app. from MS.
    All this guy wants is to make some more billions, he has no thoughts about the company, doesn't care what happens to it later. h***, he'll probably dump the stock soon anyway. Just a soon as he has made a few Mill. more

    Yahoo is far better on it's own, they don't need MS. Its the other way around, MS needs to absorb yahoo, to save MSN. and why is MSN in trouble.
    Because MS days are numbered, it's a crappy company.

  1. luckyday

    Joined: Dec 1969



    Apparently nobody here has heard of insider trading rules?

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