隔海看中国

I might have call the bubble in China’s stock market a bit early about a year ago. But the correction of the over-extended market valuation eventually happened, ahead of the upcoming Olympic Games. Shanghai SE Composite below 2000 doesn’t seem to be out of question.

Board of Directors
Yahoo! Inc.
701 First Avenue
Sunnyvale, CA 94089

Dear Members of the Board:

It has now been more than two months since we made our proposal to acquire Yahoo! at a 62% premium to its closing price on January 31, 2008, the day prior to our announcement. Our goal in making such a generous offer was to create the basis for a speedy and ultimately friendly transaction. Despite this, the pace of the last two months has been anything but speedy.

While there has been some limited interaction between management of our two companies, there has been no meaningful negotiation to conclude an agreement. We understand that you have been meeting to consider and assess your alternatives, including alternative transactions with others in the industry, but we’ve seen no indication that you have authorized Yahoo! management to negotiate with Microsoft. This is despite the fact that our proposal is the only alternative put forward that offers your shareholders full and fair value for their shares, gives every shareholder a vote on the future of the company, and enhances choice for content creators, advertisers, and consumers.

During these two months of inactivity, the Internet has continued to march on, while the public equity markets and overall economic conditions have weakened considerably, both in general and for other Internet-focused companies in particular. At the same time, public indicators suggest that Yahoo!’s search and page view shares have declined. Finally, you have adopted new plans at the company that have made any change of control more costly.

By any fair measure, the large premium we offered in January is even more significant today. We believe that the majority of your shareholders share this assessment, even after reviewing your public disclosures relating to your future prospects.

Given these developments, we believe now is the time for our respective companies to authorize teams to sit down and negotiate a definitive agreement on a combination of our companies that will deliver superior value to our respective shareholders, creating a more efficient and competitive company that will provide greater value and service to our customers. If we have not concluded an agreement within the next three weeks, we will be compelled to take our case directly to your shareholders, including the initiation of a proxy contest to elect an alternative slate of directors for the Yahoo! board. The substantial premium reflected in our initial proposal anticipated a friendly transaction with you. If we are forced to take an offer directly to your shareholders, that action will have an undesirable impact on the value of your company from our perspective which will be reflected in the terms of our proposal.

It is unfortunate that by choosing not to enter into substantive negotiations with us, you have failed to give due consideration to a transaction that has tremendous benefits for Yahoo!’s shareholders and employees. We think it is critically important not to let this window of opportunity pass.

Sincerely yours,

Steven A. Ballmer
Chief Executive Officer
Microsoft Corporation

***********************************
Here is Yahoo!’s reply:

Dear Steve:

Our Board has reviewed your most recent letter with regard to the unsolicited proposal you made to acquire Yahoo! on January 31, 2008.

Our Board carefully considered your unsolicited proposal, unanimously concluded that it was not in the best interests of Yahoo! and our stockholders, and rejected it publicly on February 11, 2008. Our Board cited Yahoo!’s global brand, large worldwide audience, significant recent investments in advertising platforms and future growth prospects, free cash flow and earnings potential, as well as its substantial unconsolidated investments, as factors in its decision.

At the same time, we have continued to make clear that we are not opposed to a transaction with Microsoft if it is in the best interests of our stockholders. Our position is simply that any transaction must be at a value that fully reflects the value of Yahoo!, including any strategic benefits to Microsoft, and on terms that provide certainty to our stockholders.

Since disclosing our Board’s position with respect to your proposal, we have presented our three-year financial and strategic plan to our stockholders, which supports our Board’s determination that your unsolicited proposal substantially undervalues Yahoo!. Those meetings with our stockholders have also provided us an opportunity to hear their views.

We have continued to launch new products and to take actions which leverage our scale, technology, people and platforms as we execute on the strategy we publicly articulated. Today, in fact, we are announcing AMP! from Yahoo!, a new advertising management platform designed to dramatically simplify the process of buying and selling ads online.

Finally, our Board has been actively and expeditiously exploring our strategic alternatives to maximize stockholder value, a process which is ongoing. All of these actions have been driven by our overarching commitment to maximize stockholder value.

Our Board’s view of your proposal has not changed. We continue to believe that your proposal is not in the best interests of Yahoo! and our stockholders. Contrary to statements in your letter, stockholders representing a significant portion of our outstanding shares have indicated to us that your proposal substantially undervalues Yahoo!. Furthermore, as a result of the decrease in your own stock price, the value of your proposal today is significantly lower than it was when you made your initial proposal.

In contrast to your assertions about the effect of general economic conditions on our business, Yahoo!’s business forecasts are consistent with what we outlined in our last earnings call. As you know, we recently reaffirmed our Q1 and full year guidance, which is a testament to our ability to perform in line with our expectations despite the current economic environment. In addition, our three-year financial and strategic plan which we have made public demonstrates significant potential upside not previously communicated to the financial markets. This plan has received positive feedback from our stockholders, further strengthening the view that Yahoo! is worth well more as a standalone company than the value offered in your proposal, and would be even more valuable to Microsoft. Your own statements have made clear the strategic importance of Yahoo!’s substantial assets and capabilities to Microsoft.

We regret to say that your letter mischaracterizes the nature of our discussions with you. We have had constructive conversations together regarding a variety of topics, including integration and regulatory issues. Your comment that we have refused to enter into negotiations to conclude an agreement are particularly curious given we have already rejected your initial proposal, nominally $31 per share at the time, for substantially undervaluing Yahoo! and your suggestions in your letter and the media that you are considering lowering the value of your proposal. Moreover, Steve, you personally attended two of these meetings and could have advanced discussions in any way you saw fit.

As to antitrust, we have discussed with you our concerns. Any transaction between us would result in a thorough regulatory review in multiple jurisdictions. As a follow up to a recent meeting among our respective legal advisors we had on this topic, and at your request, we provided to you on March 28 a list of additional information we would need to further our understanding of the regulatory issues associated with any transaction. To date, you have still not provided any of the requested information.

We consider your threat to commence an unsolicited offer and proxy contest to displace our independent Board members to be counterproductive and inconsistent with your stated objective of a friendly transaction. We are confident that our stockholders understand that our independent Board is best positioned to objectively and knowledgeably evaluate our Company’s alternatives and to maximize value.

In conclusion, please allow us to restate our position, so there can be no confusion. We are open to all alternatives that maximize stockholder value. To be clear, this includes a transaction with Microsoft if it represents a price that fully recognizes the value of Yahoo! on a standalone basis and to Microsoft, is superior to our other alternatives, and provides certainty of value and certainty of closing. Lastly, we are steadfast in our commitment to choosing a path that maximizes stockholder value and we will not allow you or anyone else to acquire the company for anything less than its full value.

Very truly yours,

Roy Bostock Jerry Yang
Chairman of the Board Chief Executive Officer

Carl C. Icahn
c/o Icahn Associates Corp.
767 Fifth Avenue, 47th Floor
New York, NY 10153

March 26, 2008

Board of Directors
Motorola, Inc.
131 E. Algonquin Road
Schaumberg, Illinois 60196

Ladies and Gentlemen:

Today’s - much delayed and long overdue - announcement regarding the spin- off of the Mobile Devices business and the establishment of two fully independent companies with separate management teams and Boards is clearly a step in the right direction. As you know, for some time I have argued that this should be done. However, as one of the largest Motorola stockholders, I continue to have concerns about the speed and manner in which a new management team is selected for the Mobile Devices business and the separation transaction is consummated. Time is of the essence and decisive action is required to reposition the Mobile Devices business for success as an independent company. Furthermore, today’s announcement begs a few key questions:

1. Why will it take you until sometime in 2009 to accomplish the separation?

2. Why does it take the threat of a proxy fight for you to make promises we all want to hear?

3. Do you intend to carry out your proposals or will it be a repeat of last year’s proxy fight strewn with a string of broken commitments? Obviously the tepid reaction of the market manifests shareholders’ views concerning the value of your commitment. The only statement made in your conference call we totally agree with is that . . . “there can be no assurances that any transaction will ultimately occur.”

You stated during today’s conference call, “we discussed Board Nominees with Carl Icahn and we proposed two nominees and he declined.” Again this is only partially true. It is true that Sandy Warner, head of the Nominating Committee called me and offered seats to two of my Nominees if I would drop the proxy fight. However, you failed to mention in your conference call that I told Mr. Warner that I would gladly accept this offer if the Board would also accept Keith Meister. Mr. Warner replied summarily to this offer that Meister did not “qualify.” I asked Mr.
Warner what does one have to do to qualify - lose $37 billion dollars?
Mr. Warner then replied that the Board did not “know” Meister. My answer was that Meister would fly anywhere at any time to meet the Board so they could “know” him (I did mention that the situation at Motorola is too serious for the Board to remain a country club). My offer to Motorola stills stands.

You have stated to the press that our request for information about what steps the Board actually took to correct the problem at Motorola is an unnecessary distraction. We disagree. In a political election when constituents believe their representatives’ performance was inadequate, they are certainly not denied information as to whether their representative acted in a grossly negligent fashion. Why should it be different in Corporate America?

I do however agree with you that this proxy fight is a distraction that Motorola at this junction can ill afford. If as you have stated, we all want to benefit the stockholders of Motorola, then what possible reason is there for not putting Keith Meister on the Board. After all, how much can he eat at the Board meetings? On a positive side, having a highly intelligent, energetic individual like Keith, who has 145 million reasons to spend his time working toward the spin-off being accomplished, may well make this promise come true in a timely fashion.

We ask the Board meet with Meister, put egos aside and let’s get on with the urgent business at hand.

Sincerely,

Carl C. Icahn

今天看到王建硕在他的博客上提及已故人大教授余虹的一篇题为《有一种爱我们还很陌生》的文章。余先生认为在Virgina Tech枪击事件纪念活动中美国人对凶手赵承熙变现出来的“爱”对中国人来说是一种非常陌生的感觉。

我觉得余虹先生的看法有些偏颇。不是很理解问什么把爱和是非道德混绞在一起。爱可以是博大的，但爱和作为社会法治基础的是非道德之间没有谁比谁更高尚的比较。其实余先生描述的并不是爱。那种让今天的国人感到陌生和惊讶的感觉是尊重，对生命的尊重。这种情感是人性的表现，它与爱或宗教无关。

Even when China is adding millions of new cellphone users per month, some companies still can find a way making money. Kyocera is the latest victim of the China Money Trap.

Kyocera Corp. is exiting the Chinese cell phone market after a joint venture failed to deliver strong sales, Nikkei English News reported, without citing anyone.
The Kyoto, Japan-based company is handing over 45 percent of its 70 percent stake in Kyocera Zhenhua Communication Equipment Co. at no cost to partner China Zhenhua Science & Technology Co., the news service said.
The other 25 percent will go to a Hong Kong-based cell phone sales firm, also at no cost, Nikkei said. Both transactions are to be completed by the end of March, the news service said.
Kyocera will also give up about 57.6 million yuan ($8 million) in loan claims, the news service said.

John Rowe on 4Q07 results.

Turning to the results, it’s hard for me to display the proper air of jubilation in the kind of the stock market we are in. But even basset hound has to howl once in a while. And we had the kind of year that we should be truly ecstatic about.

There seems to be a lot of angry investors these days. If anyone has the right to complain, it is guys from Evercore, an investor of the troubled monoline insurer Ambac. (more…)

Blum Capital is a 9.9% shareholder of MGI which recently suffered large write-down of its float investment portfolio related to subprime mortgage and, interestingly, refuse to talk to a potential suitor. (more…)

MMI is a 9.9% shareholder of UIS. After witnessing UIS share down more than 50% in the past 12 months, here is what they have to say: (more…)

What’s the best thing of not having live coverage of the award ceremony of the Golden Globe? It might be that you don’t have to worry about which designer dress you have to wear on the red carpet. But I think it is that instead of having a camera zoomed in on you and having to clap along, you can swear “son of bitch” in your PJ when you learn that you have lost your Golden Globe to your fellow nominee.