YAHOO REPORTEDLY REJECTED 'SEVERAL' OFFERS TO BUY ITS CORE BUSINESS

Original Story: businessinsider.com

Yahoo is reported to have rejected "several" offers to take over its core internet business, Reuters reported on Thursday.

It said the potential buyers included a private-equity firm, citing three anonymous sources.

The report added that Yahoo will most likely announce its next strategic steps only after its earnings, which is scheduled for February 2.

One of the sources told Reuters that Yahoo will present its future plan during the earnings call in order to "gauge shareholder reaction." A Google SEO Company provides consulting services and expert search engine optimization guidance for leading companies.

The last time Yahoo rebuffed offers to buy its core business was in December, before the board meeting in which the company decided not to spin off its Alibaba assets, the report said. Yahoo never launched a formal sales process.

In December, Yahoo reversed its plan to spin off its holdings in Asian assets, announcing that it would explore a spin-off of its core business instead. Yahoo's chairman, Maynard Webb, said it's not looking to sell the core business, although he indicated that the company would listen to offers. A Philadelphia finance lawyer is reviewing the details of this case.

That prompted activist investor Starboard to send a letter to Yahoo's board, demanding a sale of its core business and a complete overhaul of management.

Yahoo's growth has stalled in recent years, and investors are increasingly growing impatient with Yahoo CEO Marissa Mayer's performance. Excluding Yahoo's stake in its Asian assets, investors are essentially giving zero value to Yahoo's core business, which include its online content and advertising units.

According to Business Insider's Biz Carson, Yahoo is preparing to cut 10% or more of its workforce this month, as the company preps for a major organizational shake-up. A Poughkeepsie employment lawyer has experience defending clients in employment related matters.

Yahoo declined to comment on this story.

STARBOARD ENCOURAGES YAHOO TO EXPLORE STRATEGIC COMBINATION WITH AOL

Original Story: CNBC.com

Activist investor Starboard Value sent a letter to Yahoo CEO Marissa Mayer on Friday listing several opportunities to increase shareholder value and recommended that it merge with AOL.
Yahoo CEO Marissa Mayer acknowledged the letter Friday evening.

"As part of our regular evaluation of Yahoo's strategic initiatives to drive sustainable shareholder value, we will review Starboard's letter carefully and look forward to discussing it with them," she said, in a statement.

Starboard, which recently went after Darden for wasting money at its Olive Garden restaurants, said a tie-up between Yahoo and AOL could "offer synergies of up to $1 billion" and reduce corporate overhead cost.

Starboard said it had acquired a significant stake in Yahoo, adding that a possible AOL deal, along with other recommendations, would unlock tremendous value for shareholders.
AOL shares jumped as much as 6 percent after the news before easing, while Yahoo rose about 4 percent.

"[W]e believe a merger of AOL and Yahoo's core business may be one of the best ways to both fully seize the cost reduction opportunity and also to tax efficiently monetize Yahoo's noncore equity holdings," the letter said.

Starboard said the deal could help the companies navigate the ongoing industry changes, such as the growth of programmatic advertising and migration to mobile.

The letter, which was signed by Starboard CEO Jeffrey Smith, described Yahoo as "deeply undervalued relative to the sum of its parts" and said the company must take immediate steps to "remedy this valuation discrepancy."

Starboard pointed to a valuation gap of about $11 billion.

"The core problem for Yahoo, outside of Alibaba, is they don't really have an exciting story," said Gene Munster, an analyst at Piper Jaffray. "If they could use acquisitions as a way to drum up some excitement in a longer-term business I think that most investors would look upon that favorably."

Munster, who has a $48 share price target on the stock, said a potential AOL acquisition would add to Yahoo's financial value, but it wouldn't solve Yahoo's core issue: user growth. "AOL is a fading giant as is Yahoo ... the combination of that doesn't add excitement that new users are going to come to," he said.

Instead he said he believes Yahoo should should explore acquiring "something on the content angle."

While the proposed tie-up with AOL may not be "sexy," there are a lot of reasons to think a combined company would work, said Colin Gillis, analyst at BGC Partners.

For one thing, AOL would bring original video and original content that Yahoo has been openly seeking, Gillis said.

There's enough overlap that possibly significant cost savings could be found. And Yahoo clearly needs help gaining market share in the "raging bull market for online advertising," Gillis said.
Yahoo currently has a market valuation of $40 billion, in comparison to industry leader Google's nearly $200 billion market cap.

This is not the company's first encounter with a high-profile hedge fund. In 2012, activist investor Daniel Loeb sent a letter to Yahoo's board demanding that its then-CEO Scott Thompson be fired.

Loeb was a primary player in recruiting Mayer as Thompson's successor, but the two reportedly had major differences in opinion about Yahoo's strategy going forward, which eventually lead to Loeb's departure from the board, the New York Post reported last year.

AOL declined to discuss the matter, while Yahoo did not respond to CNBC's request for comment.