Shareholders of Yahoo Inc. presently do not seem satisfied due to which the internet giant had lost 35% of its shares in year 2015. In a letter released to press today, one of the big investors of beleaguered company, Yahoo, Starboard Value LP is demanding a leadership change:
“Despite over three years of effort and billions spent on acquisitions, the management team that was hired to turn around the core business has failed to produce acceptable results, in turn, causing massive declines in profitability and cash flow. It appears that investors have lost all confidence in management and the board… We are confident that both of these objectives are achievable, but will require a change in leadership and strategy.” – Starboard’s managing member and chief executive, Jeffrey C. Smith
Starboard further adds on that some board members might be replaced by election if changes are not forthcoming in leadership. No one is specified in Starboard’s letter, however. In year 2012 and 2013, Marissa Mayer and Maynard Webb became Chief Executive and Chairwoman of Yahoo Inc, respectively. Apart from this, Starboard had also threatened an attempt to overthrow Yahoo’s board if the company continued with plans to break off its $31-billion stake in China’s Alibaba Group.
The investor also thinks Yahoo could perform much better if it separates its assets without any delay – to which last month, Canyon Capital already recommended Yahoo to sell off its internet business. The hedge fund said that several potential buyers — both corporate suitors and private equity financiers — had expressed interest in buying the Internet division. Upon reach, no comment was made by Starboard.
Last month, New York hedge fund SpringOwl Asset Management expressed Yahoo to lay off 9,000 of its 10,700 workers and eliminate free food for employees to help save US$ 2 billion year-on-year scale.
