Top! tip! for! Yahoo! – 'Fire! your! board! of! directors!'
Starboard says it has nine yes men lined up for takeover
The activist investor firm who first pushed for the sale of Yahoo!'s core search business now wants to oust its board of directors.
Starboard Value says that it wants to replace all nine directors at the Purple Palace with its own group of nine execs, who will make a "significant change" at the ailing search and advertising house.
In a letter [PDF] to Yahoo! shareholders, Starboard rakes the current board over the coals for its failure to turn around Yahoo!'s fortunes and/or wrap up a sale of its core business.
"The management team and Board of Yahoo have repeatedly failed shareholders. Time and again, operating results have been decidedly negative and materially worse than management's guidance and external expectations," the letter reads.
"This atrocious performance is even more appalling when you consider the billions of dollars spent in recent years on what has proven to be wasteful acquisitions and research and development expenditures."
This as Jerry and David's Guide to the World Wide Web continues to struggle in its efforts to reverse a years-long downward spiral.
More recently, Yahoo! said that it would be seeking a buyer for its core search and ad business in an effort to return some money to investors, who believe that Yahoo!'s stake in Chinese ecommerce giant Ali Baba is worth Yahoo! itself.
Starboard was at the forefront of that investor push, and now the investment house is hoping to overhaul the board of directors with a group of execs who will follow its direction for Yahoo!
"We believe our continued involvement is crucial to ensure a full and fair sale process and to put the best possible board in place in the event a transaction for the Core Business is not achieved in the near-term," Starboard said.
"We cannot envision a scenario where the shareholders of Yahoo! would entrust the current management team and Board with executing a standalone turnaround plan, given the years of failed attempts under the current leadership."
Shortly after the Starboard letter was released, the Purple Palace issued a response from the board of directors promising it would review the letter and carefully consider the proposal that they all be fired.
"The Board's Nominating and Governance Committee will review Starboard's proposed director nominees and respond in due course," Yahoo! said. ®