A year-long tussle has finally come to an end after Yahoo officially announced that it is giving for board seats to its vocal critic, Starboard Value.
Yahoo, despite its wide online audience, has been struggling to earn profit. That is why last month, Starboard called for the replacement of the entire board of directors of Yahoo, including its chief executive Marissa Mayer and former Walmart president H. Lee Scott. On the other hand, Starboard submitted its own list of board members "to stand for election at Yahoo's next shareholder meeting," the Washington Post reported.
However, on Wednesday, Yahoo announced that it will be adding four board members handpicked by Starboard, including founder and CEO Jeff Smith, effective immediately.
"This constructive resolution will allow management and the board to keep our focus on our extremely important objectives," Mayer said in a statement.
Yahoo Finance furthermore reported that the deal is a form of sending a clear message to shareholders: "Yahoo is finally serious about a sale -- it had previously been criticized by analysts for appearing less than fully committed to fielding offers. Settling with Starboard is also a way of bringing the enemy inside the house."
"It's a public acknowledgment that Starboard had been publicly making some very valid points," says SunTrust analyst Robert Peck. "If you thought they were wrong, you wouldn't bring them in."
Part of the deal is to let Smith join Yahoo's strategic review committee that is responsible for weighing the bids with regard to the company's assets. Smith has earlier voiced out that the bidding process has become slow.
Meanwhile, among the potential buyers of Yahoo include Verizon (VZ) and Alibaba (BABA). This two are among the about 40 bidders in the original pool. However, it is not clear if only one buyer will take all of Yahoo's core businesses
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