San Francisco — Billionaire activist investor Carl Icahn, who lobbied for a Microsoft Corp. takeover earlier this year, wishes to reap profit from his $1.8 billion bet on Yahoo Inc., held talks with the software company about a purchase of Yahoo’s Internet search business, without reaching an agreement, according to a regulatory filing.
The billionaire desperately needs the besieged Internet Company’s stock to more than double in value. In addition, the filing also indicates that Icahn — who now sits on Yahoo!’s board — purchased about 6.78 million additional Yahoo! shares last week.
Icahn, who steered his way on to Yahoo’s board during the summer, has paid an average of $23.59 per share to accumulate a 5.5 percent stake in the Sunnyvale-based company, according to a Thursday filing with the Securities and Exchange Commission.
Yahoo’s stock has declined drastically since the company rejected an offer to sell to Microsoft Corp. for $33 per share in early May. The handling of those negotiations outraged Icahn, prompting him to begin snapping up the company’s stock as part of a campaign to broker a deal with Microsoft and oust Yahoo’s board of directors.
A statement with the US Securities and Exchange Commission says Icahn has informed Yahoo! that “he is in favor of pursuing a transaction with Microsoft relating to the Yahoo!’s search business.”
This runs in opposite to comments Icahn made on CNBC yesterday, when he said he is not interested in selling Yahoo! piece by piece.
In any event, there are “no understandings” with Microsoft about a possible deal, the billionaire investor said today in a regulatory filing. Icahn, who holds about 5.5 percent of Yahoo shares, became a company director in August after settling a proxy challenge that would have ousted the board.
Yahoo founder Jerry Yang has unsuccessfully attempted to accomplish a search advertising partnership with rival Google Inc., but that alliance unraveled last month just hours before the U.S. Justice Department planned to file an antitrust lawsuit to block the deal.
Yang’s decision last month to agreed to step down as Yahoo’s chief executive less than two weeks after Google backed out of the partnership swung the company shares up momentarily, but only to drop again when Steve Ballmer said Microsoft no longer has an interest in buying the Yahoo!.
In the meantime, former AOL chief Jonathan Miller according to reports raising cash to buy Yahoo! Icahn told CNBC he has spoken to Miller about the possibility of buying Yahoo!, but is not enthusiastic about the possibility because he feels the shares are undervalued.
Yahoo, based in Sunnyvale, California, fell 45 cents, or 3.9 percent, to $11.05 at 4 p.m., New York time in Nasdaq Stock Market trading. The shares have dropped 52 percent this year. Microsoft, down 46 percent this year, declined 76 cents, or 3.8 percent, to $19.11.
Today’s filing also did not indicate when the talks with Microsoft were held.
Icahn, 72, did not return a phone call seeking comment. Yahoo spokesman Brad Williams declined to comment.