Friday, August 10, 2012

Yahoo’s Mayer To Make Changes to Shareholder Rewards - NASDAQ:YHOO, GOOG

New brooms sweep differently. Yahoo's newly appointed CEO Marissa Mayer is planning to make some changes to the way shareholders in the company are rewarded, it said in a filing to the Securities Exchange Commission.

Mayer's intention in making the alterations is to enhance shareholder value but investors responded by selling the stock, which fell 4.8 percent in after-market trades.

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The new CEO will look at several parameters while rewarding shareholders, such as Yahoo's acquisition strategy, capital allocation strategy, its cash position as also its previously announced restructuring plan.

The restructuring plan may well undergo a change in light of this development and also the company’s share buy-back programme. Yahoo said that it may also lead the company to shelve its idea of returning the post-tax proceeds from the Alibaba deal which it had struck in May.

Mayer, a former Google executive, is the fifth boss the company has had in five years as the company struggles to gain an identity for itself in the fast evolving Internet world, where old rival Google has taken giant strides ahead while newer ones like Facebook are rewriting the rules of the game.

Yahoo has been caught in a `no-man's land' zone with no distinguishing service offering to separate it from many others on the Internet.

When it was first launched it had a robust search engine and along with Hotmail, also had a vibrant web-based mail platform. However, while it was never able to supplant Microsoft's Hotmail, in the search area it was quickly overtaken by Google.

Mayer, who took charge barely three weeks back, has the mandate to revive the company's struggling fortunes and to give it a specific identity in the industry.

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She started on the spring cleaning right away by saying that she would examine the entire company's operations and the recent filing seems that she may be trying to mould it after her previous company, Google Inc(NASDAQ:GOOG).

The company had been facing severe competition from Google Inc(NASDAQ:GOOG) in the search engine market.

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