Can Starboard defy the odds at Yahoo?

Will lightning strike twice for activist investor Starboard Value, this time in its fight for control of Yahoo (YHOO)? The New York-based fund replaced the entire board of Darden Restaurants (DRI) in 2014 following a similar battle for control of Olive Garden's corporate parent, which gives Starboard credibility with investors in its battle with Yahoo.

As a general rule, proxy fights don't happen too often because they're expensive to organize and hard to pull off. They require activists to convince large institutional shareholders that they can run a company better than the existing management team. Companies often will acquiesce to the activist investors by offering board seats to their representatives or through shareholder-friendly moves like stock buybacks.

"They happen more frequently than in the past," said Charles Elson, a corporate-governance expert at the University of Delaware. But he noted, "It's difficult to replace an entire board."

Marissa Mayer on Yahoo's struggles, future strategy

Given Yahoo's rocky history, however, Starboard may find sympathy for its views among CEO Marissa Mayer's numerous critics on Wall Street, who have long argued that Yahoo has been eclipsed in recent years by nimbler rivals such as Google (GOOG) and Facebook (FB).

In fact, Eric Jackson, the head of activist investor SpringOwl Asset Management, which has also targeted Yahoo, told the The Wall Street Journal that he looked forward to being "wooed" by Starboard. A spokesman for Starboard couldn't immediately be reached for comment.

Starboard, which owns a 1.7 percent stake in Yahoo, has been agitating for change at Yahoo for 18 months and has said it has repeatedly been "pushed away" by the company's management team and board. The board, according to Starboard "clearly lacks the leadership, objectivity, and perspective needed to make decisions that are in the best interests of shareholders."

Among the failings Starboard cites are the $2.3 billion Yahoo has spent on acquisitions since 2012, including its $1.1 billion purchase of the Tumblr blogging platform.

A few weeks ago, Yahoo announced that it was putting itself for sale and was laying off thousands of workers. Starwood and other critics have called for Mayer's resignation, arguing her turnaround strategy has failed.

Verizon (VZ) reportedly is interested in buying Yahoo to merge it with AOL's content business, which it acquired for $4.4 billion last year. AT&T (T) and Barry Diller's IAC/InterActive Corp (IACI) are said to be interested in Yahoo operations. Microsoft (MSFT), which made an unsuccessful 2008 bid for Yahoo, might provide financing for a bid, though it has yet to make a decision about whether to proceed. According to Starboard, the sale process is going too slowly.

"Despite what appears to be strong interest from large strategic and financial buyers as referenced in the media," Starboard said, "nearly two months have gone by since Yahoo officially publicly announced its intention to pursue strategic alternatives for the Core Business, and it seems little progress has been made."

However, Mary-Hunter McDonnell, a corporate governance expert at the University of Pennsylvania's Wharton School of Business, argues that the time isn't right to replace the entire Yahoo board, especially because negotiations are ongoing with potential buyers.

"This is an extremely young board in terms of tenure," she said. "What Starwood is doing is make suitors less willing to make their bids to this board."