Yahoo’s board is slated for its first-ever sit down with activist hedge fund Starboard Value next week — and the conversation could get testy.
The boardroom showdown — which follows months of informal phone calls between the dueling firms — is a last-ditch effort to avoid a proxy battle being threatened by Starboard, whose CEO Jeff Smith is demanding a sale of the company, sources told The Post.
Yahoo has received nearly 40 expressions of interest from prospective bidders including Verizon, AT&T, Time Inc. and “every private-equity firm you can think of,” said one source.
The process is now moving to a new stage of whittling the suitors into a more manageable group of 12 to 16 parties before it opens the data room and provides detailed financial information, the source added.
“A lot of the PE firms are starting to form groups,” said a source close to the process. “If Verizon wants it they’re the best bidder, there are $500 million in synergies.”
Nevertheless, insiders said some investors remain concerned about the auction process. While Yahoo has hired Goldman Sachs, JPMorgan and PJT Partners for the job, sources said Mayer has tapped veteran tech banker Frank Quattrone to explore sale options as well.
In particular, some sources say Quattrone appears to be trying to sell Yahoo and Mayer as a package deal.
“There’s Quattrone trying to find buyers that would want her to be the manager,” according to one source. “There’s some conflict in that.”
The source added that Mayer is “trying to softly arrange it so she continues to run [Yahoo] after it gets sold.”
The strategy, according to the source, is win Mayer’s job security at Yahoo “by having bankers very nicely mention that when they think about bidding, they think about her.”
Reps for Yahoo declined to comment. Reps for Quattrone didn’t immediately respond to a request for comment.
The reported static in the sale process could fuel Starboard’s insistence not only that Mayer be ousted, but also that it be given a majority of seats on Yahoo’s board as it looks to expedite a sale.
As reported by The Post, Yahoo’s board has been internally weighing whether to offer two or more seats to Starboard as it looks to avoid a proxy battle.
Starboard is also likely to bang the desk about a shareholder lawsuit over the giant cash pay-out to former Yahoo COO Henrique de Castro, who got $60 million for just 15 months on the job after he was booted in January 2014, sources said.
Chief Financial Officer Ken Goldman was set to update investor at a Morgan Stanley conference on Thursday in San Francisco.