The stock market is relieved to see Yahoo! CEO Jerry Yang step aside. It’s not in the least bit surprising. After turning down an offer from Microsoft at almost three times the current stock price, the only real surprise is that Jerry Yang survived this long!
The Yahoo! Board made a huge error in judgment by appointing Jerry as the CEO. Having been with the company since its inception and never having taken the job, its a clear sign that this was a job the Jerry never really cared for. In hindsight, when Terry Semel quit, it might have been far more prudent to name Jerry the interim CEO while continuing the search for a permanent CEO . This would have given both the Board and Jerry Yang a good chance to try and make some changes (or at least some plans) while the search was still on. Next, not making cuts sooner earned the wrath of Wall Street. Turning down the Microsoft offer simply made it worse. The “falling through” of the Google deal and the drop in the share price amidst the financial meltdown simply destroyed Jerry Yang’s hope of turning the company around.
Its sad to see Yahoo! struggle. Its even worse that it has a leadership crisis in the midst of these tough times. Will Microsoft (whose search strategy is yet to make a dent) step forward again given that it can possibly buy Yahoo at less than half its original offer?