Sun, Jun 08, 2008 - Page 11 News List

Carl Icahn suggests price of US$49.5bn for Yahoo


Hoping to negotiate a compromise, activist investor Carl Icahn urged Yahoo Inc to declare it is willing to sell for US$49.5 billion — about US$2 billion above Microsoft Corp’s last offer for the Internet pioneer.

Icahn recommended the price tag, which works out to US$34.375 a share, in a letter he sent on Friday to Yahoo chairman Roy Bostock.


It marks the first time that Icahn has publicly indicated what price he has in mind as he tries to force Yahoo’s sale before the Sunnyvale-based company’s annual meeting on Aug. 1.

If a deal i not reached before August, Icahn will try to replace Yahoo’s board with a slate of his own directors and then fire company cofounder Jerry Yang (楊致遠) as chief executive.

Should the mutiny succeed, Icahn said on Friday he would then hire a “talented and experienced” CEO in the mold of Google Inc chairman Eric Schmidt before trying to sell Yahoo to Microsoft.

Yahoo said it would be “ill-advised” to publicly set a specific sales price.

Microsoft declined to comment.

Merger talks between the two high-tech powerhouses fell apart on May 3, when Microsoft CEO Steve Ballmer withdrew an offer of US$47.5 billion, or US$33 per share, after Yang asked for US$37 per share — a price that Yahoo’s stock hasn’t reached since January 2006.


Many analysts have been predicting all along that Microsoft and Yahoo would eventually agree to a deal at somewhere between US$34 and US$35 per share.

At least two major Yahoo shareholders, Capital Research Global Investors and Legg Mason, have publicly pushed for a deal in the same price range.

Wall Street’s hopes that a friendly deal might still be worked out has helped cushion the blow to Yahoo’s stock since the takeover talks unraveled. Yahoo shares gained US$0.37 to US$26.73 amid a sharp downturn in the overall stock market.

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