Yahoo board repeats appeal for support ahead of AGM

by Tristan O'Carroll Media Week 01-Jul-08, 12:50

LONDON - Yahoo is again urging shareholders to support its current board of directors, ahead of its eagerly anticipated AGM next month, with a detailed presentation arguing that the company is better off with its Google ad partnership, than being sold to Microsoft.

The presentation, circulated to all Yahoo investors ahead of the AGM on 1 August, features a timeline of the Microsoft talks, indicating that on two separate occasions, executives had asked Microsoft if the company was still interested in doing a deal.

In the presentation, Yahoo claims that Microsoft was "unresponsive and inconsistent" and said that the software giant's behaviour "casts doubt on whether Microsoft was ever committed to a whole company acquisition".

At the same time, Yahoo's document outlines again why it thinks its recently-struck deal with Google, in which Google's paid-for search results are shown alongside Yahoo's natural results, is good for the company. Yahoo claims it will earn up to $450m (£227m) from the tie-up.

It also refutes proposals by rebel shareholder Carl Icahn, who is still arguing for Yahoo to return to the negotiating table with Microsoft. It argues that Icahn is demanding a sale to Microsoft, even though Microsoft has already said it won't be pursuing a deal currently, and asks shareholders to look at the share performance of other companies in which he has investments.

Jerry Yang, Yahoo's chief executive, said: "Despite all the challenges we've been through, including Microsoft's unsolicited proposal and now a proxy contest by Carl Icahn, Yahoo remains a unique value proposition.

He added: "Our ubiquitous brand name, top-ranked online properties and deep talent pool have enabled us to continue to drive our 'starting points' and 'must buy' strategies. The combination of our leading positions in search and display, together with the benefits expected from our recently signed agreement with Google make us exceptionally well-positioned to capitalize on the convergence of search and display."