If Icahn Not Have Yahoo, Boo Hoo!

According to Yahoo, Microsoft and billionaire business buster Carl Icahn are looking to lobotomize Yahoo and sell off the parts. There has got to be a movie script in the never-ending botched Yahoo takeover drama. Maybe Michael Crichton can write and direct again (he directed "Coma" and wrote the screenplay from the Robin Cook novel).

Yahoo tells the takeover drama's newest chapter in a press release/letter issued over the weekend. As of this posting, Microsoft had released no official response.

Events recap: On Friday evening, Microsoft and Carl Icahn made a new offer for Yahoo, which had a 24-hour deadline. Microsoft would acquire Yahoo's core search business, and Carl Icahn's board of directors would assume control of Yahoo's remains.

My eWEEK colleague Chris Preimesberger wrote what I now won't have to, in a Sunday blog post: "How much money is enough, Icahn? (Should we be spelling your name "I con"?)...Carl Icahn is a completely selfish putz and should be avoided at all costs."

Selfish putz? Hee, hee. Maybe. Carl Icahn is either really inconsistent or he just doesn't think anyone will notice or care enough to see his real motivations in his behavior. From the Yahoo letter:

"Ironically, Carl Icahn, who jointly with Microsoft developed and presented this proposal, had previously urged Yahoo! not to sell its search business to Microsoft. Specifically, in an interview on CNBC's Fast Money program, on June 4, 2008, Mr. Icahn said, 'it's crazy for this company now to do this alternative deal and give the store away, because obviously, an alternative deal is a poison pill because once you've done an alternative deal and given the search to Microsoft, you don't need Microsoft to buy you anymore. So, that would be a poison pill.'"

I haven't seen the interview and can't vouch that Carl Icahn said what Yahoo claims. But if the statement is accurate and not out of context, his motivations are revealed. The search deal is either a "poison pill" or it's not. This is an either/or situation. If a poison pill, Carl Icahn shouldn't be involved in carving out search for Microsoft, if he truly is looking out for Yahoo shareholders' interests. Way I see it, Carl Icahn's greed is obvious.

Greed is just the most delightful of spectacles when exposed to sunlight. Dracula decays before the yellow orb's rays.

Yahoo's press release/letter quotes Chairman Roy Bostock as calling the Icahn-Microsoft offer a "'take it or leave it' proposal under which we would be required to restructure the company, hand over to Microsoft Yahoo's valuable search business and to Carl Icahn the rest of the company, giving us less than 24 hours to respond. It is ludicrous to think that our board could accept such a proposal."

That's for sure. But why would Carl Icahn and Microsoft make such a proposal with such a tight deadline? Now? Influence. Two other institutional investors control the largest blocks of stocks. Carl Icahn would have little chance to win his proxy fight without their support. The delayed shareholders meeting is Aug. 1. The vote is fast approaching. He needs to lock in key voting blocks now.

Microsoft has already stated that it won't negotiate with Yahoo's current board. The new offer could be a thinly veiled PR play, where Microsoft can claim another good faith effort rebuffed by an unreasonable Yahoo. Microsoft is being unreasonable and greedy to induce coma. A little brain death would make Yahoo easy to carve up for body parts.

I think the offer and tightness of the deadline indicates how desperate and arrogant are Carl Icahn and top Microsoft executives. Desperation is the approaching vote deadline. Arrogant is the audacity of the offer. They want to break Yahoo's will.

But it is Yahoo's willingness that should—and quite possibly does—disturb Carl Icahn and Microsoft. From the Yahoo press release/letter:

"Yahoo's board points out that a transaction to acquire the whole company would be much more straightforward and involve far less risk than the new proposal or any similar alternative. The board believes a whole company transaction could be negotiated and executed prior to Aug. 1. In rejecting the Microsoft/Icahn proposal, Yahoo not only repeated its offer to sell the entire company to Microsoft for at least $33 per share, but also offered to negotiate an improved search-only transaction. Microsoft rejected both offers."

Yahoo is willing to be bought in its entirety, and quickly. Roy is probably right in saying that "Microsoft and Mr. Icahn are trying to dismantle the company and deliver our search business to Microsoft on terms that would be disadvantageous to Yahoo stockholders."

Related Posts:

• Yahoo, What Icahn Do to You, Microsoft Watch, July 7, 2008
• Yahoo's Response to Carl Icahn, Microsoft Watch, July 7, 2008
• Microsoft's Letter Supporting Carl Icahn, Microsoft Watch, July 7, 2008
• Carl Icahn's Letter, Microsoft Watch, July 7, 2008
• Microhoo: Breaking Up Is Hard to Do, Microsoft Watch, July 2, 2008
• With or Without Yahoo, Microsoft Watch, June 25, 2008
• Don't Yell 'Yahoo' So Fast, Microsoft Watch, June 25, 2008
• Microsoft Adds Insult to Injury, Microsoft Watch, June 16, 2008
• Google-Yahoo Smacks Microsoft, Microsoft Watch, June 12, 2008
• Icahn Talk, Why Can't Microhoo?, Microsoft Watch, June 12, 2008
• Google Search Share Surges, Live Languishes, Microsoft Watch, May 22, 2008
• Live Search Cashes In on Cashback, Microsoft Watch, May 21, 2008
• Microsoft's Yahoo Plans Advance>>08, Microsoft Watch, May 19, 2008
• Microsoft and the Yahoo Lobotomy, Microsoft Watch, May 19, 2008
• Steve Ballmer and the Microsoftdom of Yahoo, Microsoft Watch, May 18, 2008
• Icahn Yahoo Better than You, Microsoft Watch, May 15, 2008
• Yahoo: Between a Rock and a Hard Place, Microsoft Watch, May 8, 2008
• Why Didn't Microsoft Yell 'Yahoo'?, Microsoft Watch, May 5, 2008
• Will He Stay or Will He Go?, Microsoft Watch, May 5, 2008
• The Microsoft-Yahoo Blame Game, Microsoft Watch, May 3, 2008
• What Steve Said to Jerry, Microsoft Watch, May 3, 2008
• Microsoft Boo-Hoos Yahoo, Microsoft Watch, May 3, 2008
• Open Letter to Steve Ballmer, Microsoft Watch, May 1, 2008