For Yahoo, Grim Lessons From BEA Systems' Fall
Professor Michael Klausner is quoted in a Marketwatch article about a comparison of the current Yahoo takeover battle with a previous one in which Carl Icahn had been a successful player:
Michael Klausner, a corporate law expert at Stanford Law School, also noted important differences in the two merger battles.
In the battle for BEA, he said, "He had time to threaten. Here he doesn't."
"Launching a proxy fight to woo back an acquirer is uncharted territory," Klausner said.
And he pointed to what he saw as a major weakness in Icahn's game plan: A new board may be in a weaker position to renegotiate a deal with Microsoft.
"Yahoo will get a better deal if the people negotiating on its behalf are willing to walk away," he said. "If nothing else, the current board has demonstrated that it can do that."
On the other hand, he added, "A board that has been elected in order to sell the company to Microsoft will have difficulty credibly threatening to walk. They may not get as good a deal for Yahoo."
He said an Icahn takeover could also prompt more Yahoo employees, considered by many analysts as the company's most valuable asset, to leave.
"As has been the case all alone, a friendly deal would be best for the shareholders," he added.