Daniel Loeb, the CEO of hedge fund Third Point LLC, Monday sent a letter to the internet giant Yahoo Inc. (YHOO) demanding the books and records related to the hiring of Chief Executive Scott Thompson, the appointment of Patti Hart to the Board, and the selection of few other Board members.
Third Point, in the communique, referred to the Section 220(b) of the Delaware General Corporation Law. This section provides investors with the right to inspect corporations books and record for a proper purpose at any time.
Last week, Loeb had sent a letter to Yahoo board demanding that Thompson should be terminated, as he embellished his academic qualifications in his biography.
In reply, Yahoo admitted that the statements about Thompson's educational background were false, but described the falsities in Thompson's educational background as an "inadvertent" error.
"Third Point believes that Yahoo! shareholders and employees will be best served if the Board accepts responsibility quickly for this latest debacle. If the Directors are truly interested in "working in a constructive manner with Third Point", they should provide answers promptly. We believe that this internal investigation by this Board must not be conducted behind a veil of secrecy and shareholders deserve total transparency," Third Point said in the statement.
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