US - Two pension funds have filed a complaint accusing internet company Yahoo's directors of personal resentment hurting shareholder profit.
The plaintiffs alleged: "The Yahoo board members have placed personal distaste for Microsoft ahead of shareholder welfare.
"Accordingly, plaintiffs seek to [prevent] the Yahoo board from taking any further steps to effectuate any transaction that will prevent Yahoo's shareholders from selling their shares for the maximum price available."
The document stated that following the rejection of the initial bid, Yahoo's financial condition had worsened, it's stock performance weakened and shareholder discontent had reached a "boiling point".
As lead plaintiffs, Police & Fire Retirement System of the City of Detroit (Detroit Police & Fire) and General Retirement System of the City of Detroit (Detroit General) alleged Yahoo had discussed possible deals with Time Warner, Google and News Corp.
The complaint also said recent changes to employee contracts would increase costs, making a deal with Microsoft more expensive and therefore unattractive.
It continued: "Refusing to initiate negotiations is simply value-destructive."
The document concluded: "Instead of obtaining the highest price Microsoft may pay in a negotiated context, the board has left Microsoft no option but to depart or take a hostile posture, and the board is evidently prepared to enter into a value-destructive transaction to deter Microsoft and avoid their own ouster."
Bernstein Litowitz Berger & Grossmann was stated as lead counsel to the plaintiffs.
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