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Tuesday, March 27, 2012

Yahoo No Longer Trying to Keep Merger Bid Secret

Story first appeared in the Wall Street Journal.

Yahoo Inc. has ended an effort to keep documents related to a 2008 merger bid from Microsoft Corp. sealed, more than a week after activist shareholder sought to have the material exposed to public view.

Yahoo has opted to withdraw its application to continue restrictions on public access to the documents, which it had filed with a Delaware court earlier this month, according to court records. The documents had been filed as part of a roughly four-year-old shareholder lawsuit -- since settled -- against the Sunnyvale, Calif., company.

The activist's hedge fund Third Point LLC has recently mounted a proxy challenge to Yahoo, in which it has obtained a stake of more than 5%. Third Point is seeking to have four of its nominees elected to the embattled Internet firm's board of directors.

Yahoo countered over the weekend with three of its own board appointees.

As part of its proxy challenge, Third Point filed a motion in a Delaware court on March 15 opposing Yahoo's efforts to keep under seal the shareholder litigation documents related to its decision to rebuff a $31-a-share takeover bid from Microsoft.

Third Point has said in public filings that the Yahoo board's rejection of Microsoft's bid was among its "misjudgments and failures."

Yahoo's shares closed Monday at $15.54. The company is seeking a turnaround under their Chief Executive, who was hired in January.

It wasn't immediately clear when the Microsoft-related documents stemming from the shareholder litigation would become publicly available.

Yahoo and Microsoft have formed a partnership in the years following their scuttled merger talks that has Microsoft powering Yahoo's Internet search results in a revenue-sharing arrangement.