Categories: OLD Media Moves

Persistant problems with Yahoo coverage

Eric Jackson, a senior contributor to TheStreet.com, writes Wednesday about how a lot of the recent business news coverage of Yahoo has been off the mark.

Jackson writes, “There were five things that were reported on with certainty last month that were not necessarily certain at all.

“1. A couple of weeks ago, many media reports said that Jerry Yang told the AsiaD conference in Hong Kong that he wasn’t going to sell the company. That was odd, as I was in the audience and don’t recall him saying that at all. I forget his wording.

“He might have said they weren’t going to be a forced seller or they didn’t have to sell if they didn’t want to. He was saying they are playing from a strong hand. Maybe it was a bluff. Later on in the discussion, he said very clearly that they (the board) were going to do what was right for the shareholders. I took that to mean that — just as everyone suspects — this thing is still in the middle of a sales process.

“2. A Wall Street Journal article a couple of weeks ago quoted some private equity bidders as saying they thought Yahoo! was only worth $16 to $18 a share in a buyout and was already over-priced at $15 as the stock was at $11 in August. Really? I think Apple has a fair value of $25 a share. It’s all hype and I’d really rather buy it at that price than $400.

3. A Bloomberg report on Friday night interrupted an otherwise pleasant dinner I was having. It quoted — in its ‘scoop’ – ‘5 unnamed sources’ who said that Yahoo! was going to separate their Asian assets in a tax-free manner that would lead to a stock buyback or a dividend.

“I immediately started getting emails and tweets from folks saying ‘they are screwing the shareholders’ presumably because they aren’t selling the Asian assets to someone who would have to pay 35% on assets worth $20 billion according to Yahoo! So, Yahoo! found a way to save $7 billion and that caused the stock to drop 10% or $2 billion on Monday.

“This scoop about the ‘cash-rich split’ method of tax savings was actually reported the previous day by the Wall Street Journal as a ‘scoop.’ Except I first discussed the cash-rich split method six weeks earlier than that in TheStreet as to what the Yahoo! board should do. Glad they listened.”