There is pressure mounting on Yahoo Inc. from its investor groups as they are not willing to allow Marissa Mayer, the Chief Executive of the company more time to show a recovery progress and perk up the revenues.
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In January this year, Mayer had laid out a plan to sell the $30 billion (nearly Rs 2 lakh crore) Alibaba stake, however, the proposal was rejected, which represented a stark dissent with her plans.
Managing Director of SpringOwl, Eric Jackson, sees many potential candidates who could replace Ms. Mayer, including former interim CEO Ross Levinsohn and former Chief Development Officer Jacqueline Reses. “I think the basic strategy that he was advocating was in hindsight the right strategy”, Jackson said.
The company said that it would, instead, look at creating a separate company to hold the rest of its assets, in a strategy it is calling a “reverse spin” of its original plan.
The latest investor demands come less than a week after Yahoo dropped plans to spin off its $31 billion stake in China e-commerce giant Alibaba and instead sell off its ailing core business, the approach urged by Starboard Value, another investor with a big Yahoo stake. A proxy fight could ensue in the coming months should the investors fail to find their way in persuading the board to take into consideration their plans.
Starboard Value and other shareholders are unlikely to share the board’s patience and have have written letters to the Yahoo board, voicing their opposition to the company’s current path. By selling the Alibaba stake Mayer meant to revive Yahoo’s core Internet unit focusing on growing mobile, video and social media ads.
Canyon Capital Advisor, which owns 10 million shares in Yahoo! Inc.
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SpringOwl also wants Yahoo to cut 75% of its workforce and bring on a strategic partner to help navigate the tax issues surrounding Yahoo’s Asian assets, the WSJ report said.
