Yahoo investors are saying they’re fed up with corporate vacillation and excessive spending.
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The protest by SpringOwl is the latest in a chorus of shareholders exasperated by Mayer’s failure to re-energize Yahoo to the stature it held in the early days of the consumer internet. Some argue for Yahoo to sell its core businesses as quickly as possible.
FILE – In this Tuesday, June 17, 2014, file photo, Yahoo CEO Marissa Mayer attends the Cannes Lions 2014, 61st International Advertising Festival in Cannes, France. All the while, Yahoo seemed ready to spin off the company’s Alibaba holdings into a separate company. The firm is particularly concerned that Yahoo didn’t include “any clear details in terms of analysis, process or timing” with its announcement.
Requiring shareholders to wait at least another year for Yahoo to explore and complete the spinoff of its Internet businesses as outlined December 9 is “simply unacceptable”, the firm said in a document reviewed by Bloomberg.
Mr. Jackson estimates Yahoo could fetch about $6 billion if it sold its core business today.
A Yahoo spokeswoman declined to comment. If the company proceeds with that plan, the manoeuvre could take more than a year, extending a turnaround attempt that has so far failed to produce signs of growth.
Canyon Capital wasn’t the only investor with something to say about the current state of Yahoo.
If we’ve said it once, we’ve said it too many times, Marissa Mayer is not having a great time running things over at Yahoo (YHOO). (Jackson says he is trying to gain support for his plan among majority investors).
Starboard originally agitated to have Yahoo sell its stake in Alibaba but then changed its view that the company should put its core business up for sale after the U.S. Internal Revenue Service in September denied a request for a ruling on whether the spinoff would be tax free.
Yahoo needs to act now and prioritize selling off some assets, the core operations or the whole business, Canyon Capital Advisors, which owns about 10 million shares in the beleaguered company, wrote to the board in a letter dated Friday.
Now, Eric Jackson, managing director of SpringOwl Asset Management, is offering an alternate plan, calling for a new CEO, massive layoffs, no more lavish parties, and getting rid of perks like free food and iPhones for employees. Potential candidates could be former Yahoo interim CEO Ross Levinsohn, or former Yahoo Chief Development Officer Jacqueline Reses, who is now at Square, Jackson said.
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A $1bn deal for Tumblr in 2013 was criticised by investors – it lifted Yahoo’s user base to around one billion but did not bring in advertisers.
