Yahoo!'s Santa Monica location. Board member Patti Hart won't run for re-election.
Backstory: Dan Loeb, a hedge funder who runs Third Point, wants to take over a chunk of the Yahoo board, make management changes, and above all else NOT sell off Alibaba, the Asian e-commerce site that Yahoo owns 40 percent of.
The board rebuffed him, questioning his qualifications, after offering only two seats to Loeb's demand for four and saying that he couldn't have one of them. He fired back a letter revealing that Yahoo CEO Scott Thompson had misrepresented his academic record, claiming a computer science degree he never received. The Yahoo board member who oversaw the vetting of Thompson, Patti Hart, was also revealed to have fudged her degrees.
So now Hart will be leaving the Yahoo board, a position worth $80,000 a year, but with extras thrown in for serving on various committees, plus stock grants. Here's Kara Swisher, blind-sourcing the heck out of the news:
Yahoo!'s Santa Monica location. Activist shareholder Dan Loeb has fired another salvo in his ongoing battle to change the company's management.
Dan Loeb, the swashbuckling hedge funder who's trying to remake Yahoo's board of directors and, while he's at it, get Yahoo to jettison its CEO, has just upped the ante yet again. And he's done it, in typical Dan Loeb fashion, with an ancient means of communication. No, I don't mean a stone tablet or dispatch carried by Pheidippidian messenger over great distance. I mean a letter. Printed on paper and delivered, the letter itself says, by "Federal Express and Hand Delivery."
You half expect Loeb to revive the Pony Express at this point! This is all starting to feel like a novel by Laclos.
But I kid. Here's the top part:
Third Point LLC sent Yahoo! a demand today pursuant to Section 220(b) of the Delaware General Corporation Law to inspect books and records relating to the hiring of CEO Scott Thompson, the appointment of Patti Hart to the Yahoo! Board, and the selection of Board Members Peter Liguori, John Hayes, Thomas McInerney, Maynard Webb, Jr., and Fred Amoroso. A copy of Third Point’s demand is attached below.
Third Point believes that Yahoo! shareholders and employees will be best served if the Board accepts responsibility quickly for this latest debacle. If the Directors are truly interested in “working in a constructive manner with Third Point”, they should provide answers promptly. We believe that this internal investigation by this Board must not be conducted behind a veil of secrecy and shareholders deserve total transparency.
Yahoo!'s Santa Monica location. Embattled CEO Scott Thompson was caught faking his resume and could resign this week.
It's unclear whether Scott Thompson, the Yahoo CEO who was caught faking his resume last week by activist hedge-fund investor Dan Loeb of Third Point, will stay or go as the latest leader of the embattled Internet giant. The Guardian suggests he could be gone this week. But it also fudges a bit, quoting Colin Gills of BGC Financial, who says that canning Thompson would be a major setback for Yahoo's turnaround plans.
In any case, who is this Dan Loeb, owner of almost 6 percent of Yahoo and a perpetual thorn in the side of the company's management and board?
He's a man who's unafraid to express his outrage, as it turns out. But his vehicle is so old-fashioned that it's almost charming. Last week, he attacked Thompson using the form of communication that predates the Internet, search engines, hedge funds, iPhones, automobiles, indoor plumbing, the United States of America, and sea voyages under sail. That's right, he wrote a...letter.
Yahoo!'s Santa Monica location. A shareholder proxy battle may loom.
Recently, Yahoo admitted that it can't come to terms with Dan Loeb, who runs a hedge fund called Third Point that owns a decent percentage of the struggling Internet company and really, really doesn't like where Yahoo is going. Yahoo isn't nuts about Loeb, either — and said so when it revealed that it isn't going to let him gain a seat on the board on directors.
Loeb owns almost six percent of the company and has been making noise for months now about undertaking a proxy battle for control the Yahoo board. He's been extremely un-quiet about what he thinks Yahoo is doing wrong, going so far as to establish a website, valueyahoo.com, which outlines Third Point's case for turning Yahoo around and replacing four board members with its own slate.
Here's the vision that Loeb & Co have outlined: