A shareholder group with a stake in Yahoo is pressuring the tech company's chief executive Marissa Mayer to cuts costs and merge with AOL, according to reports.
The group, Starboard Value LP, sent a letter to Mayer asking her to act on its highlighted opportunities which include merging with AOL, selling its foreign stakes in Alibaba and Yahoo Japan and cutting costs, according to Business Insider.
Mayer reported receiving the letter on Friday and said in a statement:
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We are committed, as an organization, to acting in the best interests of the Company and all of its shareholders. We have maintained, and will continue to maintain, an open dialogue with all of our shareholders. As part of our regular evaluation of Yahoo's strategic initiatives to drive sustainable shareholder value, we will review Starboard's letter carefully and look forward to discussing it with them .
Starboard's stake in Yahoo is unknown, but groups with more than a 5 percent stake in a public company must state that in a regulatory filing, according to the Wall Street Journal. Starboard's letter also suggested selling off Yahoo's stake in Alibaba and Yahoo Japan to make a quick $11 billion.
AOL, despite having sold off most of its assets (such as Patch) and its patent portfolio, still has a lot of viewership, but that doesn't make it attractive enough to be a suitable partner. Sure, Yahoo has more than $9 billion in cash, about three times what's needed to buy AOL, but we can't really see any reason why Yahoo would want a tech company from the 1990s. It already is one.