Yahoo Wounded vultures circling prey

Another interesting flash across the news wires this morning was that Carl Icahn is planing on nominating his own board of directors to Yahoo’s board, and wanting to have Microsoft come back and make another play.

The interesting part, wounded Yahoo after pissing off just about everyone by not selling out to Microsoft, and now Microsoft’s pretend disinterest in pursuing Yahoo has spooked just about everyone. In a brilliant move of psychological business practices, Microsoft might just end up getting what they wanted, at the price they wanted, because everyone is going to knee jerk as an emotional reaction rather than really take a look at the numbers.

Is a Microsoft Yahoo merger good, depends on the view point. That is the great part about all this, Yahoo really isn’t that wounded, but as pressure mounts to get rid of the Yahoo board that “killed the deal with Microsoft” stockholders, analysts, and others can pretty much so figure out that this is not going to be another Apple resurrection story, this time it will be all the folks who are involved directly and indirectly putting pressure on the board.

Oh, the intrigue; the recent breathtaking game of “Deal or No Deal” between Microsoft and Yahoo. Unless you’ve been rafting down the Bolivian mountain’s Tuichi River for the last three months, you’re well aware of Jerry Yang and Co’s, repeated rejections of Microsoft’s increasingly generous overtures. The last one being a lofty (cough cough) - $33.00/share or $47.5 Billion dollars! This represented a full 70% premium over Yahoo’s closing price of $19.18 on January 31. With Microsoft CEO, Steve Ballmer playing the role of Howie Mandel, Yang sent two of his yings to politely tell him “No Deal Stevie…No Deal”! Source: Sean Maguire

You have to admit as a drama, soap opera this really works out, but business students should be paying deep attention to this one. This is a lesson in power plays, back room politics, the tension between stock holders, management and board members. Let alone all the folks without a voice who are going to get steamrolled in this process.

If the Yahoo board asks Microsoft to come back to the table, Microsoft’s hand is so very much stronger that they can cut themselves a much more advantageous deal than they ever good have before. Good for Microsoft, in the end everyone at Yahoo will not get what they thought they were going to get if Yahoo comes back as a supplicant.

Tags; yahoo, microsoft, buyout, saga, not over, carl icahn, board, money