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Yahoo’s stock rises in wake of CEO’s departure, Third Point deal

By Jeremy C. Owens, San Jose Mercury News –

SAN JOSE, Calif. — Yahoo received an immediate stock bump Monday from the departure of embattled CEO Scott Thompson and a deal that gives its largest outside investor a greater deal of control.

Yahoo rose as much as 3.1 percent in Monday trading, even as the market and other tech stocks suffered at the hands on investors. The Sunnyvale, Calif., Internet company’s shares opened at $15.47, an increase of 1.8 percent from Friday’s closing price, and reached as high as $15.77 before closing at $15.50, an increase of 2 percent. The rise was in direct contrast to the larger market, as all three major U.S. stock indexes declined at least 1 percent.

The stock bounce comes on the heels of CEO Scott Thompson’s decision to step down Sunday, when Yahoo also announced a deal with Third Point’s Daniel Loeb, the investor that revealed a false degree on Thompson’s bio less than two weeks ago, setting off a furor that ended in Sunday’s blockbuster announcement. Thompson reportedly told Yahoo board members that he had been diagnosed with thyroid cancer, forcing him to step down; Ross Levinsohn, Yahoo’s global head of media, will take the helm of the company on an interim basis.

Along with Thompson stepping down, Yahoo announced Sunday that Third Point would receive three of the four board seats it was angling for, avoiding a proxy fight at the coming annual shareholders meeting. Loeb will become a director, along with two of his hand-picked nominees, while two of Yahoo’s choices will take the board spots of departing directors, including the role of chairman left vacant by Roy Bostock.

Monday morning, Yahoo also announced new software that will allow its advertisers to comb though the reams of information available to them. Genome, a “big data” application, combines data from the advertisers, Yahoo and recent Yahoo acquisition Interclick to offer corporate advertising clients the opportunity to improve ad personalization.

“Marketers have asked us for a solution that capitalizes on our vast data and our answer to that is Genome,” Rich Riley, Yahoo’s executive vice president for the Americas, said in the company’s announcement.

Riley introduced the new software at the company’s Internet Week presentation in New York, where Thompson and Third Point were not discussed. Oakland A’s general manager Billy Beane gave the keynote speech at the event before Yahoo’s announcement, speaking about how data has transformed baseball.

Yahoo’s stock price has been a sticking point in investor relations for years, as the Internet company has fallen prey to stronger competition from Facebook and Google in the online-advertising field Yahoo previously dominated. The board and then-CEO Jerry Yang, a co-founder, turned down a buyout offer from Microsoft in 2008 that valued the company at $31 a share, but the stock price has never again approached that high a price.

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