Scott Thompson, the Yahoo Chief Executive Officer who was being investigated by board members on allegations that he overtly padded his resume, has left the building and will not return. In his place is Ross Levinsohn, who Yahoo named interim CEO as it seeks a permanent replacement, or at least one that will last longer than Thompson did, which is barely more than four months.
An analyst with Evercore Partners said in a note that "Investors are likely to take comfort in fresh leadership, particularly at the board level," pointing out that eight of the 11 board seats were filled in the past year alone. Along with Thompson's departure, Yahoo board chairman Roy Bostock is stepping down, and indeed investors reacted positively to the news, pushing Yahoo's stock price up 1.6 percent in pre-market trading, Reuters reports.
Investment firm Third Point, which has a 5.8 percent stake in Yahoo, was the driving force in all this, recently demanding that Yahoo look into Thompson's hiring and make public the review process. With the resignation of Thompson and Levinsohn, Third Point has agreed to end its pending proxy contest and withdraw its previous board nominations, as well as vote its 70,545,400 shares in support of Yahoo's nominees.
"The board is pleased to announce these changes and the settlement with Third Point, and is confident that they will serve the best interests of our shareholders and further accelerate the substantial advances [Yahoo] has made operationally and organizationally since last August. The board believes in the strength of the company's business and assets, and in the opportunities before us, and I am honored to work closely with my fellow directors and Ross to continue to drive Yahoo forward," said Fred Amoroso, Yahoo's board chairman.
Yahoo, which closed at $15.19 per share on Friday, was up to $15.52 in pre-market trading on Monday. The company has a market cap of $18.51 billion.