San Francisco A potentially nasty battle to reshape Yahoo's board of directors will begin within a week unless the troubled internet company submits to the demands of a major shareholder.
Third Point, a hedge fund that owns a 5.8 per cent stake in Yahoo, issued its ultimatum in a letter on Wednesday to company CEO Scott Thompson.
The letter, released in a regulatory filing, comes a month after Third Point first announced that it wanted four seats on a Yahoo board already undergoing an overhaul.
The board currently consists of 11 directors, but chairman Roy Bostock and three other members announced they will step down at Yahoo's annual meeting. The departures are part of an attempt to placate shareholders frustrated with a long-running financial funk that has depressed the company's stock price.
Third Point believes Yahoo would fare better if the hedge fund's representatives were in the boardroom. Third Point's proposed directors are: Daniel Loeb, the hedge fund's manager; former NBC Universal CEO Jeff Zucker; former MTV Networks executive Michael Wolf and turnaround specialist Harry Wilson.
In Wednesday's letter, Loeb told Thompson he was disappointed with Yahoo's "dismissive" attitude towards Third Point's candidates since the two men spoke on February 17.
"The board's stonewalling, apparent insouciance and decision not to engage with us in a serious manner, has left us no choice but to directly approach our fellow owners," Loeb wrote.
