I wrote a review earlier "Carl Icahn steps in and buys 50M shares of Yahoo after Microsoft walks away" on FinGad. And guessed that Icahn will take some sort of action against the board. Well, no surprise. Icahn has selected an alternative board, interestingly with Mark Cuban on board, and is pushing a battle on Yahoo!'s management with the top majority shareholders of the company. 

Techcrunch reported on this here, with a clever headline: "Dear Yahoo: You're Fired" 

What a position to play. The man acquired over $1.5B of Yahoo! stock and combined with other top 2 or 3 shareholders, will have a 15% ownership battle. He's going after more shares after regulations are cleared. 

Yahoo!'s board responds, interestingly from the chairman and not Jerry, here:  Full Text

In this card game, successful CEOs expressed that for Microsoft to walk away from the deal would be a conspiracy theory. This is wonderfully expressed here, before the news of Microsoft walking away: Marc Andreessen blog. 

In my view, it does not matter what the Yahoo! board says now. It all comes down to numbers. I once heard a brilliant CEO say if your numbers suck, no matter what you say, everyone will think you're an idiot. And if your numbers shine, no matter how stupid you act, everyone thinks you're a genius. This is not a word game, but a numbers game. What it comes down to is: who has the most voting power and support. 

Carl Icahn is known for these major power moves. He tried this at Time Warner, however he got no progress there. This seems different. Considering that he's capable of generating support and voting power - of which we will learn - this makes it difficult for the existing board to continue in it's position. I believe the board will lose the proxy battle and Yahoo! will undergo major changes in senior management. 

Does this mean to invest in Yahoo! stock?

In my view, the negative side to what will happen shall Carl succeed is the morale at Yahoo! will be burther deteriorated and key employees will continue departing to other organizations. 

In my view, investing in Yahoo! is a high risk for a small investor as we don't have the information that's circulating in the top circles. At the same time, I don't believe in an ability to successfully turn around a company by replacing it's entire board, including the key founder CEO Jerry - which is very important for that person to stay on - as that person built the company from the ground. Now deep pockets are coming in with different intentions.