Yahoo investors want CEO search to review outsiders

Font Size

Print

Feedback

Email

Discuss

Nov 20: Yahoo! Inc. investors say the search to replace Chief Executive Officer Jerry Yang should focus on a turnaround expert from outside the Internet company who can draw Microsoft Corp. back into takeover talks.

Yahoo announced plans this week to replace Yang, fueling speculation the board will seek to woo Microsoft back. Hiring an insider such as President Susan Decker may signal Yahoo is planning “more of the same,” limiting the likelihood of new talks, said Darren Bagwell, director of equity research at Thrivent Asset Management Inc. “Who’s kidding who? We all know what the endgame is,” said Bagwell, whose Appleton, Wisconsin-based firm had about $73 billion in assets under management, including Yahoo shares, as of September. “The board finally recognises that there’s frustration and change is required.”

Possible candidates include former Yahoo executives Ellen Siminoff and Dan Rosensweig, he said. Whoever takes the job will be charged with rejuvenating a stock that has plunged by more than half since Yang took over and shoring up Internet advertising sales that are increasingly falling behind those of Google Inc.

UBS AG analyst Ben Schachter identified News Corp. President Peter Chernin and former EBay Inc. chief Meg Whitman as potential choices. Either may balk at joining a company that’s only being prepared for a sale, according to Bagwell.

“Why would Chernin, Whitman or somebody like that really want to sign up for Yahoo?” Bagwell said. “If I were a betting man, I’d be leaning more toward a pick that’s less high profile, probably somebody more operationally focused.”

Yahoo, based in Sunnyvale, California, dropped $2.41, or 21% , to $9.14 at 4 p.m. New York time in Nasdaq Stock Market trading after Microsoft CEO Steve Ballmer reiterated that the company isn’t interested in buying Yahoo. The decline, the biggest in more than two years, took the shares to their lowest point in more than five.

Siminoff, a Yahoo senior vice president until 2002 and now chairman of Efficient Frontier Inc., declined to say whether Yahoo had contacted her. “Yahoo’s been down before but not out,” she said in a phone interview yesterday. “Jerry truly wants what is best for the company. If he stepped down, it meant that he thought it was time for a change.”