Entities associated with investor Carl Icahn have sold 12.7 million shares of Yahoo (NSDQ: YHOO) stock—or about 16 percent of their total holdings in the company—in what they are calling a move to “balance” their portfolios. In a filing with the SEC, Icahn’s affiliates say that the sale of stock should not be taken to mean that they have lost faith in the direction of Yahoo: “The sales in no way were intended to reflect the Reporting Persons long term view of the Issuer, since the Reporting Persons are optimistic about its long term prospects. The Reporting Persons continue to believe in the wisdom of the Microsoft-Yahoo search transaction and fully support the performance of the Issuers CEO, Carol Bartz.” Indeed, Icahn has publicly come to the defense of the partnership, calling it an “excellent deal.”
With the sale, Icahn will now control 62.9 million shares, or about 4.48 percent of Yahoo’s total stock. Icahn had boosted his Yahoo holdings in November, when he purchased about 7 million shares for roughly $67 million.
Icahn accumulated most of his stake in Yahoo last spring as part of a proxy fight to remove Yahoo’s board and replace it with a new board that would negotiate the sale of the company to Microsoft (NSDQ: MSFT). He later withdrew his slate of candidates in exchange for a seat on the board for himself and two of his representatives.
At an average price of around $14.80, he will have now sold about $188 million worth of stock. Considering that he paid about $25 on average for his stake, he may have lost as much as $129 million on the sale.
By Joseph Tartakoff