Yahoo rejects joint Microsoft, Icahn proposal
Yahoo Inc said on Saturday it has rejected a joint proposal from Microsoft Corp and activist investor Carl Icahn that would have involved selling its search business to the software maker, Reuters reported.
Yahoo said it received the proposal "for a complex restructuring" on Friday evening and was given less than 24 hours to accept. It also said Microsoft and Icahn had made clear they were unwilling to negotiate the fundamental terms.
The Web company, which has been embroiled in on-again, off-again deal talks with Microsoft for six months, said the latest offer was not in the best interest of its shareholders as it carries less financial value and more risk than Yahoo's current search advertising deal with Google Inc
Yahoo had signed the deal with Google in June after rejecting an alternative offer from Microsoft to buy Yahoo's search business and take a minority stake in the company.
The Microsoft/Icahn proposal would also preclude a potential sale of all of Yahoo "for a full and fair price, including a control premium," Yahoo said in a statement.
Icahn owns nearly 5 percent of Yahoo and is seeking to oust Chief Executive Jerry Yang and Yahoo's board at the company's annual shareholder meeting on August 1.
Yahoo said the Microsoft/Icahn proposal would require the immediate replacement of its board and removal of top management, which it said would destabilize the company for the up to the one year it would take to gain regulatory approval for the deal.
"This odd and opportunistic alliance of Microsoft and Carl Icahn has anything but the interests of Yahoo's stockholders in mind," Yahoo Chairman Roy Bostock said in the statement. "Clearly, Microsoft, having failed to advance in search, is aligning with the short-term objectives of Mr. Icahn to coerce Yahoo into selling its core strategic search assets on terms that are highly advantageous to Microsoft, but disadvantageous to Yahoo stockholders."
Microsoft and Icahn were not immediately available for comment.