Microsoft: Hello ValueAct, Goodbye Ballmer in 2014
So let's get this straight: Microsoft (MSFT) CEO Steve Ballmer decides (on his own) that he wants to retire within a year. A week after Ballmer's decision, Microsoft offers a board seat to ValueAct Capital, an investor activist group that is looking for changes at the software giant. Coincidence? Hmmm….
According to Microsoft:
"The cooperation agreement provides for regular meetings between Mason Morfit, president of ValueAct Capital, and selected Microsoft directors and management to discuss a range of significant business issues."
"The agreement also gives ValueAct Capital the option of having Morfit join the Microsoft board of directors beginning at the first quarterly board meeting after the 2013 annual shareholders meeting."
ValueAct has $12 billion in assets under management, and the company owns approximately 0.8 percent of Microsoft stock — making ValueAct one of the software company's largest shareholders.
When Ballmer announced his decision last week to retire within a year, he insisted a potential war with ValueAct had nothing to do with the decision. Fast forward to the present and it's hard to believe that statement, considering the ValueAct news came the Friday evening of a holiday weekend here in the U.S.
While Microsoft remains extremely profitable, the company's tablet and smartphone missteps have investors concerned. And it sounds like ValueAct wants to pressure Microsoft to return more money to shareholders.
In fact, perhaps ValueAct has already applied some pressure — in the form of provoking or influencing Ballmer's resignation? Hmmm?
