Tuesday, August 05, 2008

Washington Post: Major Yahoo Shareholder Concerned Over Voting Irregularities

Joseph Weisenthal
Tuesday, August 5, 2008; 1:07 AM

A very bizarre twist in the ongoing Yahoo ( NSDQ: YHOO) saga, sure to to set off the tinfoil hat crowd? Major shareholder Capital Research Global is concerned about possible voting irregularities following last Friday's shareholder vote count. Kara Swisher first reported the news this afternoon that sources close to Capital Research thought there was something funny about the stated results. Now Reuters is reporting the same. The gist: Assuming that Capital Research voted most of its 15 percent stake against Yang and Roy Boystock, then virtually every single other share would've had to be voted in their favor. Yang, for example, was elected with over 85 percent of the votes cast. Bostock got a bit less than 80 percent. In a year where a lot of shareholders are clearly frustrated with management, this level of support would be pretty surprising. More broadly, it's surprising that Yang and Bostock both got more support than they did last year.

Kara also notes another voting anomaly, which is that lest votes were cast this year than last. Given the hubbub leading up to the vote that's a bit of a surprise, though as she notes it could be because in an uncontested election, shares aren't automatically cast.

However this turns out?and the issue is not with Yahoo itself, but with the outside vote tabulators?it's unlikely to have a major effect on the actual outcome. But while 85 percent looks like a clear mandate, 70 percent support (or potentially 65 percent in the case of Bostock) starts to look a lot more like a no confidence vote.

Update: Activist investor Eric Jackson?who actually bothered showing up at the meeting to voice his displeasure with the board?wrote about the seemingly funny math on his blog last night. He walks through the numbers from this year, 2007 and 2006 to show why things look weird. However this turns out, it looks like the Tech Journalists Full Employment Act Of 2008 is getting some kind of extension.

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