Third Point to sell most of Yahoo stake, Loeb to quit board

Activist hedge fund Third Point reached an agreement to sell two-thirds of its stake in Yahoo back to the company, pocketing a tidy profit and relinquishing three seats on the board of a company trying to effect a tricky turnaround.

Third Point’s decision to sell a chunk of its single largest corporate holding comes as the struggling Internet company’s stock fell over 4 per cent on Monday after having surged more than 80 per cent during the past 12 months, due largely to aggressive share buybacks and the value of Yahoo’s Asian assets.

Third Point, headed by Daniel Loeb, struck an agreement to sell 40 million of its shares back to the company at US$29.11 apiece, and retain about 20 million shares.

Third Point amassed the bulk of its stake in Yahoo during a one month period in 2011, acquiring some 45 million shares of Yahoo at an average price of US$13.02 according to regulatory filings.

It was unclear why Third Point was selling its shares now. Third Point declined to comment, but Loeb expressed his confidence in Yahoo’s prospects in a statement on Monday.

Chief Executive Marissa Mayer, the former Google executive whom Loeb was instrumental in appointing, is about a year into a plan to try to bring viewers and users - and the revenue growth they represent - back to the former Internet icon. She has embarked on an acquisition spree to bring new talent into the fold, while driving video and mobile content to boost advertising revenue.