After a bungled buyout offer from Microsoft, a deal with Google that fell apart and two rounds of layoffs, Jerry Yang is calling it quits and stepping aside as chief executive of the company he cofounded, Yahoo said Monday.
Yang, who became CEO in June 2007, will take on his former title of “Chief Yahoo” once a successor is found, and also remain on the board.
He has been under intense pressure from shareholders in recent weeks for a string of perceived missteps that began in February with Microsoft’s US$45 billion offer to buy Yahoo. Microsoft was offering $33 per share for its Internet rival but Yang rejected that price as too low.
Eventually Microsoft withdrew its offer and Yang went on to talk with News Corp. about a venture with MySpace and with TimeWarner about a merger with AOL, but the talks came to nothing. In June he struck an advertising deal with Google but that too fell apart in the face of opposition from the U.S. Department of Justice.
With Yahoo shares closing under $11 on Monday, the Microsoft offer, with the benefit of hindsight, looks like a very attractive one, thus the discontent from some shareholders.
Yang appears to recognize this and at an Internet conference in San Francisco two weeks ago made a thinly veiled initiation to Microsoft to come back to the negotiating table.
“To this day I would say that the best thing for Microsoft to do is to buy Yahoo,” he said. When quizzed on whether he would stick to a higher price that he demanded back in May he added, “Oh no. At the right price, whatever the price is.”
But Microsoft CEO Steve Ballmer didn’t bite and said a couple of days later, “We are not interested in going back and re-looking at an acquisition. I don’t know why they would be either, frankly. They turned us down at $33 a share.”
Yang was seen by many as the main impediment to a deal with Microsoft, but that doesn’t mean a deal is now much more likely to happen, said analyst Charlene Li, founder of Altimeter Group. “The board was behind him and they’re still there, and Yang is still there, so I don’t think a Microsoft deal is imminent,” she said.
