Most of us thought that the Yahoo-Microsoft saga is over while many were anticipating some covert tactics of hostile takeover of Yahoo by Microsoft. Proving both the groups wrong, the Yahoo-Microsoft saga has been revived from an unexpected quarter. Carl Icahn, the billionaire investor and activist shareholder has entered the picture with 50 million Yahoo shares worth over $1 billion in his kitty, in anticipation of acquiring a seat in the Yahoo board. Icahn wants to launch a proxy war that would eventually bring Yahoo to accept Microsoft’s offer for acquisition.
Despite Icahn’s past successes with TWA, Time Warner, Oracle and BEA, his new activism might not be as easy as it seems. Microsoft on its part has said that it has ‘moved on’ after being rebuffed by Yahoo. How much truth is there in Microsoft’s assertion is not clear. The current scenario in the equity market is showing that Yahoo’s shares are performing much better than anticipated after Microsoft walked away from the deal but Microsoft’s share prices have remained the same. When Microsoft offered Yahoo its $44 billion acquisition deal, Yahoo’s share was at $19 per share. With the current share price being around $26 per share, Yahoo might ask for a higher price for acquisition. Now it remains to be seen whether Icahn’s activism will do any trick.
