SAN FRANCISCO — The activist hedge fund Starboard Value announced on Thursday a slate of nine candidates to run for the board of Yahoo, commencing a fight for control of the embattled Internet company.
In doing so, Starboard is seeking to oust Yahoo’s entire incumbent board as the company pursues a potential sale of itself.
The slate of candidates includes Jeffrey Smith, the chief executive of Starboard. The fund said in a letter to shareholders that it holds a 1.7 percent stake in Yahoo.
“It is unfortunate that this action is necessary,” Starboard said in the letter to investors. “As you know from reading our prior letters, we have been attempting to work with Yahoo for the past 18 months. Over this time frame, we have repeatedly requested an opportunity to work with the company, including offers to join the board and work constructively with the current directors. At every step of the way, management and the board have pushed us away.”
Starboard had previously called into question the leadership of Marissa Mayer, Yahoo’s chief executive and a director.
By increasing the pressure on Yahoo’s board, Starboard believes, it will bolster the chances that the onetime web giant will finally sell its core businesses.
Yahoo has argued that it is serious about exploring such a sale, retaining three investment banks and contacting a number of potential buyers, including telecommunications giants, media companies and private equity firms. A number of possible suitors have signed nondisclosure agreements, though the process is still in its early stages.
But in its letter, Starboard contends that there are reasons for shareholders to be “highly concerned” about the sale process.
“Despite what appears to be strong interest from large strategic and financial buyers, as referenced in the media, nearly two months have gone by since Yahoo officially publicly announced its intention to pursue strategic alternatives for the core business, and it seems little progress has been made,” it said.