Yahoo!’s new boss and new mother Marissa Mayer is being joined on the board by fellow Google alum Max Levchin, a successful tech entrepreneur, as the corporate family takes on the look of
a tech leader. (Getty Images for TechCrunch/AOL)
Yahoo!’s board is getting a full Loeb-otomy.
Activist investor Dan Loeb completed his boardroom overhaul yesterday with the appointment of a fourth Yahoo! director. PayPal co-founder Max Levchin was named to the board, while two holdouts from the old guard, Brad Smith and David Kenney, will depart.
The changes come seven months after Loeb, the head of New York hedge fund ThirdPoint, settled his bitter proxy fight with the Web portal in exchange for the right to appoint his slate of directors.
The latest board shake-up adds another friendly face for CEO Marissa Mayer, who also got her position thanks to Loeb’s bare-knuckled brawling. Mayer worked at Google with Levchin, who sold his startup Slide to the search giant. He is also the chairman of Yelp.
“Max is someone I’ve admired throughout my career for his phenomenal sense for great products and keen focus on user experiences,” Mayer said in a statement.
The changes are another break from the past dysfunction that had plagued Yahoo! as it churned its way through executives.
Former CEO Scott Thompson, who was hired after the ouster of Carol Bartz, was pushed out earlier this year after Loeb uncovered a discrepancy in his resumé.
The embarrassment was Loeb’s victory. He won a seat on the board, along with two seats for directors of his choosing. He had been looking for a fourth director to implement his plan of returning Yahoo! to its Internet roots.
“This breaks the cycle,” said Colin Gillis, an analyst with BGC Partners. “Yahoo!’s problems were top-down from the board.”
Much of the old board is gone, including co-founder Jerry Yang and ex-chairman Roy Bostock, who both left this year.
Loeb has made a fortune on Yahoo! since September 2011, when he first bought a 5.15 percent stake for about $825 million. That stake has grown to 6.5 percent and is worth almost $1.2 billion.
“It’s a hard road still, but Yahoo! was trading as a distressed asset and now it has bumped up off those levels,” Gillis said. “The direction is the right way.”
Investor confidence is on the rise, in part due to Mayer’s leadership and Loeb’s show of support. He continues to buy shares, and last month added 3 million, pushing his stake to more than 75 million shares.
Meanwhile, Mayer is making her own moves, installing Henrique De Castro as operating chief. He is focused on running Yahoo!’s advertising business.
Mayer has been concentrating on software, including a recent e-mail redesign and a new Flickr, the company’s answer to Facebook’s popular photo-sharing service Instagram.
But the biggest changes are yet to come with an overhaul of the Yahoo! homepage, which is expected to bring a whole new look to the most popular Web portal.
Ryan Jacob of the Jacob Internet Fund said that Yahoo! ’s stock moves, including the selling of part of its 40 percent stake in China’s Alibaba, have made it one of his fund’s top holdings.
“It’s taken a long time, but we are finally seeing some of the value being appreciated,” Jacob said. “We’ve had to be very patient with this one.”