Rumors flew around this morning about Yahoo CEO Scott Thompson quitting, and earlier this afternoon, Yahoo confirmed it. They have also stated that Ross Levinsohn is the new interim CEO, and Fred Amoroso is the new chairman of the board.
Although there has been no official statement given on the reason to Thompson quitting, common sense says that it is due to his false degree. Thompson claimed in his resume and financial filings that he had a degree in computer science.
After checking in with Thompson’s college, Stonehill in Easton, MA, they have confirmed that he does not hold a bachelor’s degree in computer science, but he does hold one in accounting.
Thompson has been under pressure from activist shareholder Daniel Loeb, leader of investment fund Third Point, a company that holds a staggering 5.8% share in the company’s stocks. Loeb has been at odds with Thompson over the direction of Yahoo and he was the one that informed the U.S. Securities and Exchange Commission about the false degree.
Third Point has been pushing for Amoroso to join the board of directors, and representatives from the firm such as Daniel Leob will also be joining the board. They have agreed to stop their fight.
Even though Yahoo is considered a superpower, they have been struggling to keep up with Google and Facebook. In 2009, their overall US ad revenue was 15.7%, which as of last year dropped down to 9.5%, and they’re estimated to be as low as 7.4% this year, according to eMarketer.
With Thompson leaving, this is another victory for Third Point. Daniel Loeb’s plan for the future for Yahoo is radically different than Thompson’s, and odds are will lead to the end of Yahoo’s patent lawsuits. This may be a good move by Yahoo, and it may fix a lot of their image issues.
Thompson was brought in from being PayPal president in January. He came in after the firing of Carol Bartz, Yahoo’s previous CEO, who claimed the company “fucked her over” after she had failed to turn the company around.
Yahoo’s Release Statement on Thompson:
SUNNYVALE, Calif. — Yahoo! Inc. (NASDAQ: YHOO) today announced that the Board of Directors has named Fred Amoroso as Chairman of the Board of Directors and Ross Levinsohn as interim Chief Executive Officer, effective immediately. The Company also announced that its Board has reached an agreement with Third Point LLC (“Third Point”) to settle its pending proxy contest related to the Company’s 2012 annual meeting of shareholders.
Mr. Amoroso replaces Roy Bostock, who has stepped down from his role as Non-Executive Chairman in order to accelerate the leadership transition for the new Board. Mr. Levinsohn replaces Scott Thompson, former Chief Executive Officer, who has left the Company.
Under the Board’s settlement agreement with Third Point, three Third Point nominees — Daniel S. Loeb, Harry J. Wilson, and Michael J. Wolf — will join the Yahoo! Board, effective May 16, 2012. Mr. Bostock, along with Patti Hart, VJ Joshi, Arthur Kern and Gary Wilson, all of whom previously disclosed their intentions not to stand for re-election, as well as Mr. Thompson, have decided to step down from the Board immediately.
As a part of the settlement agreement, Third Point, which owns an aggregate of 70,545,400 shares, or 5.8% of Yahoo! common stock, has agreed to withdraw its previous Board nominations for consideration at the annual meeting and vote its shares in support of Yahoo!’s nominees. Yahoo!’s slate of director nominees for election or re-election at the 2012 annual meeting of stockholders will now include Fred Amoroso, John Hayes, Peter Liguori, Thomas McInerney, Maynard Webb, Sue James, David Kenny, Brad Smith, Daniel S. Loeb, Harry J. Wilson and Michael J. Wolf.
As interim CEO, Mr. Levinsohn will manage the Company’s day-to-day operations with assistance from Yahoo!’s existing senior leadership team.