Yahoo! (NASDAQ: YHOO) today announced plans to repurchase 40 million shares of common stock from New York City-based hedge fund Third Point LLC. The purchase price of $29.11 a share is equal to Yahoo!'s stock price as of market close on July 19. That will work out to $1.16 billion for the purchase.

The repurchase agreement with Third Point will be part of a previously announced overall plan from Yahoo! to buy back an additional $1.9 billion worth of common stock. Upon completion, approximately $700 million will remain under the $5 billion buyback authorization announced last year, the company said.

Upon the completion of the repurchase, Third Point will own less than 2% of Yahoo!'s stock, or approximately 20 million shares, according to the company. That will be down from 5.8%. Additionally, each member of Yahoo!'s Board of Directors nominated by Third Point -- Michael J. Wolf, Harry J. Wilson, and Third Point CEO Daniel Loeb -- will resign from the board, effective July 31.

Loeb was quoted in the company press release as being satisfed with many of the board's recent decisions, particularly the appointment of Marissa Mayer as CEO, explaining that since her hiring, "Yahoo!'s stock price has nearly doubled, delivering significant value for shareholders." Mayer, meanwhile, thanked all three board members "for the tremendous opportunities they created here at Yahoo!."

Loeb instigated the departure of former Yahoo CEO Scott Thompson in 2012 by revealing that Thompson did not have a computer science degree, as Yahoo! had previously stated.

After the three step down, Yahoo!'s board will have seven members.

Since the start of 2013, Yahoo! has seen its stock price move from $19.90 to $29.11 per share, a 46% rise. Shares of Yahoo! fell $1.22 to $27.89 in Monday morning trading and are at $28.17 as of this writing. Shares hit a five-year high of $29.83 on Thursday.

-- Material from The Associated Press was used in this report.

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