Based on a recent report published by Reuters, Yahoo Inc named three board members on Sunday to prepare for a proxy fight with shareholder Daniel Loeb. The independent directors are John D. Hayes who worked as chief marketing officer at American Express, Peter Liguori, the former chief operating officer at Discovery Communications and Thomas J. McInerney, the chief financial officer at InterActiveCorp. These directors will occupy their positions on April 5.
There is no longer a secret that Yahoo is in desperate need of a reform that could get rid of all its financial problems. This is why investor Daniel Loeb announced that he will install four new members at the company’s board. The decision came after criticizing the Internet company for its flawed strategy.
The Sunnyvale firm wanted to prevent a proxy fight; therefore, they initially tried to choose only those directors that were mutually accepted by Loeb’s Third Point and Yahoo. Harry Wilson was the first choice they made, but the proposal was rejected by Loeb because he was hoping to get a board seat for himself.
Yahoo spokespersons declared in the Sunday statement that the company wanted to avoid the proxy fight to reduce costs and expenditures. However, they could not accept Loeb within the board of directors because the decision would not be in the interests of the company and its shareholders. Despite this, Yahoo remains open to the proposals made by Third Point.
Third Point, on the other hand, told the press that the company has done everything that was possible to reach a compromise with the Sunnyvale firm. Unfortunately, Yahoo rejected their offers, thus forcing the hedge fund to engage in a “time-consuming and distracting proxy contest”. Moreover, Loeb’s enterprise accused Yahoo of being scornful even though the Internet giant lacks restructuring capabilities and media strategies.
Third Point investors have many reasons to show their discontent towards the Internet corporation. Yahoo was offered $44.6 billion by Microsoft in 2008, but the company rejected the proposal hoping that they would regain their financial stability. Their market capitalization is now smaller than half the sum offered by Microsoft.