Pension Fund Sues Yahoo
There will be no hearts and flowers for Yahoo from a Michigan pension fund. In "Yahoo Rejection of Microsoft Bid Draws First Shareholder Suit," Information Week reporter Antone Gonsalves writes that the Wayne County Employees' Retirement System of Michigan is taking Yahoo to court. Alleging failure to "meet its obligation to shareholders in evaluating the offer," Wayne County is asking Yahoo directors to thoroughly vet the computing giant's offer, especially given the bid price compared to where Yahoo common stock is currently trading ($31 versus roughly $19).
According to the 2006 Annual Report (most recent document posted on the Wayne County Employees' Retirement System website), their common stock holdings take the form of mutual funds. It's not clear if their reported 13,600 shares of Yahoo are held as part of a pool. An asset allocation pie chart shows equity with a 66 percent sliver. As of September 30, 2006, Wayne County's assets came close to $1 billion. What will be interesting to watch is whether WCER is left in the dust as pension funds with larger stakes compete for a more visible litigation role.
According to the Yahoo company website, its 401(k) plan includes a company match. If that match takes the form of Yahoo stock, a 401(k) stock drop lawsuit may be just around the corner.
