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Icahn May Walk

Billionaire investor Carl Icahn dropped the first hint that he may be preparing to suspend his proxy fight against the Yahoo board, following the Web giant's announcement of a new Google partnership last week. In an interview with Reuters, Icahn said he thinks the Google deal "might have some merit" and is "better than the alternative deal proposed by Microsoft."

Icahn's (sort of) about-face is important, says Silicon Alley Insider's Henry Blodget. In the Google deal, there's a change of control provisions that allows either Google or Yahoo to terminate the search arrangement in the event that Yahoo is acquired or if the majority of its board is replaced. That leaves the door open for Icahn and his proxy slate, but Blodget says the mere fact of its existence could be enough to lead Icahn to pull the plug on his campaign. Why, because if the Google pact doesn't work out, Microsoft can still swoop in and acquire Yahoo, which would terminate the Google partnership.

The other big reason Icahn should consider walking away: "He has already lost. Carl never had a real plan for Yahoo other than selling it to Microsoft, and at least in the near term, that plan is toast," says Blodget.

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