Tag Archives: tsra

Yahoo, Starboard Value Call A Truce, Agree To Four New Directors

In what Yahoo ( YHOO ) CEO Marissa Mayer called a “constructive resolution,” the troubled Web portal announced Wednesday that it had reached an agreement with activist investor Starboard Value to add four new independent directors to the company’s board. In March, Starboard had proposed replacing Yahoo’s entire nine-member board with its own slate, saying Yahoo’s current management team and board had “repeatedly failed shareholders” and shouldn’t be in charge of a strategic review of Yahoo’s core search and display ad business or determine the fate of Yahoo’s 15% stake in China e-commerce giant Alibaba Group ( BABA ) and its holdings in Yahoo Japan. Under the agreement announced Wednesday, Starboard has withdrawn its director nominees. Instead, Yahoo will add four new independent directors, including Starboard CEO and Chief Investment Officer Jeffrey Smith. Also joining the Yahoo board are Tor Braham, a former managing director and global head of technology mergers and acquisitions for Deutsche Bank Securities; media executive Eddy Hartenstein; and Richard Hill, the former interim CEO of Tessera Technologies ( TSRA ). At the company’s upcoming annual meeting, two incumbent directors will not stand for re-election, giving Yahoo an 11-member board going forward, the company said. “This constructive resolution will allow management and the board to keep our focus on our extremely important objectives,” Mayer said in a statement. Starboard’s Smith said, “We look forward to getting started right away and working closely with management and our fellow board members with the common goal of maximizing value for all shareholders.” Yahoo is in the process of evaluating buyout offers. Yahoo stock has more than doubled since Mayer, who had been a top executive at Alphabet ‘s ( ) Google, was hired as CEO in July 2012. But she’s been unable to spark significant earnings and revenue growth, and Yahoo has struggled to build online- and mobile-ad revenue vs. rivals Google, Facebook ( FB ) and others. Yahoo stock was down 1% in midday trading in the stock market today , near 37, down 18% in the past 12 months but up 40% since early February in anticipation of a sale. Last week, Yahoo gave no specifics on its efforts to find a buyer for its core business and perhaps its big stakes in Alibaba and Yahoo Japan. Most of Yahoo’s value comes from its Alibaba stake. Yahoo’s total market cap is near $34.8 billion. Yahoo last week reported Q1 earnings and revenue that topped Wall Street expectations, but its Q2 revenue outlook lagged analyst expectations. For Q2, the company forecast revenue of $1.05 billion to $1.09 billion, down 14% at the midpoint and below consensus views of $1.102 billion. Yahoo had reportedly had set a deadline of April 18 for bids by potential acquirers, with Verizon Communications ( VZ ), which owns AOL, rumored to be among the most active bidders. For Q2, Yahoo forecast revenue of $1.05 billion to $1.09 billion, down 14% at the midpoint and lagging consensus views of $1.102 billion. Alibaba stock was down nearly 2% midday Wednesday, near 77, while Verizon stock was up nearly 2%, near 51.

Yahoo To Add 4 Independent Directors In Deal With Starboard

Yahoo ( YHOO ) has reached a deal with Starboard Value to name four independent directors  while the hedge fund ends its bid to replace the entire board of the ailing web giant. Under the terms of the agreement, Starboard has withdrawn its Yahoo board nominees. Former Deutsche Bank Securities M&A head Tor Braham, media exec Eddy Hartenstein, Tessera Technologies ( TSRA ) chairman Richard Hill, and Starboard CEO and Chief Investment Officer Jeffrey Smith will become board members, effectively immediately, said Yahoo in a statement. Current directors Lee Scott and Sue James will not stand for re-election at the company’s annual meeting to allow for an 11-member board. “This constructive resolution will allow management and the board to keep our focus on our extremely important objectives,” said Yahoo CEO Marissa Mayer in the statement. Starboard had late last year pressured the Internet heavyweight to nix its Alibaba ( BABA ) spinoff, then in March issued a letter to Yahoo shareholders, telling them it was “extremely disappointed” with the company’s “dismal financial performance, poor management execution, egregious compensation and hiring practices, and general lack of accountability and oversight by the Board.” Under pressure from Starboard, Yahoo has accepted bids for all or part of the company. Verizon ( VZ ) is seen as a lead suitor in the first round of bids. Yahoo stock fell fractionally soon after the opening bell on the stock market today . Separately,  Marvell Technology ( MRVL ) agreed to add five directors, giving in to demands from Starboard Value. Starboard took a 6.7% stake in Marvell in February. Marvell Technology stock rose 1.4% to 10.10.

Marvell Catches Activist Starboard Investment; Upgraded To Buy

Beleaguered Marvell Technology Group ( MRVL ) stock pocketed a major upgrade Monday on activist investor Starboard Value’s nearly 7% stake in the Bermuda-based chipmaker. Marvell stock flew almost 7% on Feb. 3, the day Starboard’s investment was announced. Starboard has built its investment since December, B. Riley analyst Craig Ellis wrote in a research report. Ellis upgraded Marvell stock to buy from a sell rating. Yet, in the stock market today , shares were down 1.5%, trading near 8.80. Starboard’s 6.7% stake in Marvell “casts significant doubt on our ‘sell’ rating which was predicated on financial inquiry completion risks and post-review financial execution concerns,” Ellis wrote. In October, Marvell revealed an accounting error may have shifted 7%-8% of sales to Q2, rather than Q3. Marvell’s PricewaterhouseCoopers auditor resigned amid the probe. The resulting internal investigation questioned senior management’s operating style. The SEC and U.S. Attorney’s Office joined the investigation in December. Marvell noted it’s “common for governmental agencies to open investigations in these circumstances.” Starboard’s investment isn’t a panacea, but could come with several Marvell board seats, “a tier-1 auditor and marque CFO,” Ellis wrote. Starboard also was an investor in TriQuint before it became Apple ( AAPL ) supplier  Qorvo ( QRVO ) and Integrated Device Technology ( IDTI ). “We believe (Starboard) knows semiconductors well, with a record of agitating for increased shareholder interest,” he wrote. Starboard consultants include Tessera Technologies ( TSRA ) Chairman Rick Hill, Viavi Solutions ( VIAV ) CEO Oleg Khaykin and former Integrated Devices interim CEO Jeff McCreary. It’s also possible Starboard could help Marvell wrangle R&D capabilities, Ellis wrote. “Past checks show undisciplined and at times ineffectual field sales and engineering,” he wrote. At least two analysts rate Marvell stock a sell, and 21 others rate the stock as a hold. Ellis is among at least five analysts to rate Marvell stock a buy. Ellis boosted his price target on Marvell stock to 12 from 7.