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Tech Check
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No more mincing words, no more chipping around the edges: Jerry Yang has made a mockery of the vaunted company he helped create. And now he's creating havoc where it otherwise didn't need to be.
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There's a not so fine line between hubris and fiduciary responsibility. Yang has plenty of the former and is sorely lacking in the latter. He has a fiduciary responsibility to get as much money as he can for his company. But he also ought to know a good -- even great -- deal when it's presented to him.
Of course, if shareholders are frustrated, they have only themselves to blame after squandering the opportunity to vote out Yang and his board of subordinates when they had the chance at last summer's shareholder meeting.
Why the tough assessment tonight? Because Yang is on the wires pining once again for a deal with Microsoft [MSFT
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"People who know me know I don't have an ego about remaining independent versus not remaining independent," he reportedly said at the Web 2.0 conference. He also says he remains "open-minded" about selling Yahoo's search business to Microsoft, but concedes there is no "new news" on talks between the two companies.
Yahoo Saga
- Yahoo's Yang says Microsoft Deal Still Best Option
- Google Scraps Yahoo Deal Amid Antitrust Concerns
- More Boohoo Than Yahoo for Yang
Are you kidding me? Microsoft offered to buy the whole enchilada for $47.5 billion at the beginning of the year, a staggering 70 percent premium back then. Yet, Yang and team held out for more. And now, billions of market cap wiped away since, he comes to the conclusion that it was a good deal after all?
It'd be one thing if Yang was dealing from a position of strength. But Yahoo's been beaten down so badly these last few years that "strength" is simply no longer a part of the equation.
Yang was acting like a 50-year old former, star high school quarterback, embarrassingly clutching the glory days long since passed. And the more he held out, the more he blustered for a higher price, the more embarrassing it got.
And yet the negotiations and the posturing continued. Yang and team have ridden these shares down to a recent low of $11 and change. Their only pops north come not from its own business fundamentals, but from the off chance that the company will seal some kind of partnership with someone to get this company back on track.
Good luck. It botched the Microsoft deal; it can't even get a deal together with a company in arguably worse shape than itself: Time Warner's [TWX
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] AOL; and just today, Google [GOOG
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] rescinded its proposed ad-sharing partnership with Yahoo [YHOO
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] because of ongoing Justice Department anti-trust concerns.
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And now, tonight, after all this time, Yang comes to the conclusion which he should've recognized at the outset: that a deal with Microsoft is Yahoo's best option. Trouble is, the delays will likely cost Yahoo's shareholders $20 billion or so, and that's only if Microsoft comes back to the table. Which it should because both these companies actually really do need each other.
Meantime, kiss that $34 a share offer goodbye. Yang would be lucky to attract half that at this point. A piece of advice to Team Yahoo: Don't tell the world a deal with Microsoft makes sense, or is the best deal around -- at the right price. Pick up the phone, dial 425 882 8080 and ask for Steve Ballmer's office. I'm sure he'll take the call. Just ignore the snickers and smirks and get a deal done. You owe it to your shareholders. And your legacy.
Data is a real-time snapshot *Data is delayed at least 15 minutes