Ousted Yahoo CEO Carol Bartz criticizes board
The drama following the ouster of Yahoo Inc. chief Carol Bartz may have racked up enough public insults, swearing and large cash prizes to qualify for a reality TV show.
Two days after her over-the-phone firing by Yahoo Chairman Roy Bostock, Bartz went public with her criticisms of Bostock and his board, reportedly calling them a bunch of “doofuses” and using other terms outside the scope of a family newspaper.
But Bartz, who may receive as much as $10 million in severance pay, was not the only one flinging barbs.
Shortly after purchasing a 5.2% stake in Yahoo, activist investor Daniel Loeb of the Third Point hedge fund sent a note to the company’s board, calling not only for Bostock’s “prompt” resignation, but also “sweeping changes” to the board.
Not that Loeb was taking Bartz’s side. The investor also said in his note that hiring her in 2009 was one of the board’s many “serious misjudgments.”
“Although we are pleased that the board has terminated Ms. Bartz’s employment,” Loeb said, “we fail to understand why this decision was so long in coming given her abysmal performance over the last two and a half years.”
There was no official word on who would be picked as the new chief executive, but rumors centered on Ross Levinsohn, currently Yahoo’s corporate vice president for the Americas region and a longtime media executive formerly with Fox Interactive Media.
“He is the kind of person with extensive experience in both media and Internet offerings that would seem to make for a good start to the CEO conversation,” said Scott Kessler, a Standard & Poor’s analyst.
Yahoo, based in Sunnyvale, Calif., declined to make Levinsohn available for comment.
In a recent interview, when asked about where Yahoo may have lost its way, Levinsohn told Reuters, “I think Yahoo has been doing so many things well for so long and frankly got a little trapped in, I think, ‘Oh, what is Yahoo?’ People don’t ask Google, ‘What is Google?’
“We have a lot of businesses that make a lot of money too,” he added. “The important thing is to figure out how they all work together.”
Yahoo’s stock rose more than 6% after Loeb’s letter became public Thursday, closing at $14.44. The stock is down 13% since the beginning of the year.
“This has turned into a circus,” Kessler said of the aftermath of Bartz’s firing. “It’s unfortunate because Yahoo in many respects was a great company. You have a lot of hardworking people there trying to do good work, and at the least this cannot be helpful for morale there.”
Loeb — who is known for his public letters criticizing the performance of companies in which he invests — named several Yahoo board members who he believed should step aside.
He singled out Arthur Kern, a director since 1996, and Vyomesh Joshi, executive vice president of the printer business at Hewlett-Packard Co. and a Yahoo board member since 2005.
Loeb also named Sue James, a retired partner at the accounting firm Ernst & Young and currently the president of Tri-Valley Animal Rescue in Pleasanton, Calif. James has been on the board since last year.
For her part, Bartz told Fortune magazine she plans to remain a director on Yahoo’s board — a possibility the company quickly moved to quash Thursday.
“Ms. Bartz is obligated to resign from the board and we expect her to do so,” Charles Sipkins, a spokesman for Yahoo’s board, said in a statement.