In an era when authenticity and complete transparency rule, Yahoo (YHOO) is failing miserably, and shareholders are not happy. The company is currently engaged in a battle for eyeballs with Google (GOOG) and a tussle for corporate control with the hedge fund Third Point. The hedge fund’s vocal leader, Daniel Loeb, has been on a tear lately as he asserts his company’s 5.8% ownership of Yahoo to empower change within the organization.
Loeb’s latest ammunition comes by way of recent findings that suggest that Yahoo’s CEO, Scott Thompson, grossly misrepresented himself in company documents that detail his educational background. In response, Yahoo has admitted that it may have misstated the educational background of its new CEO. Yahoo attributed the discrepancy to an “inadvertent error.” This news would barely make a ripple if Yahoo was on a tear, but that is not the case. If anything, Yahoo has been in a holding pattern trying to figure out its next move, and the stock is down a few percentage points this week while flirting with a dip below $15 per share. Certainly the company did not imagine its ideal next step as a PR rebuttal to cover its collective behinds.
In past weeks, Loeb was nothing more than a bully shooting spitballs through a straw at Yahoo, but armed with new data, Loeb’s little spitballs are now grenades. Citing falsified documents in which the current Yahoo CEO claimed educational accolades that were never achieved, Loeb’s voice of discontent is certainly louder than it’s ever been.To continue reading, click here.