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One of Yahoo!'s (Nasdaq: YHOO ) largest stakeholders is retreating.
Carl Icahn has sold shares of the struggling online giant in each of the past three trading days, enough to take his stake below 5%.
Icahn is typically referred to as a "billionaire activist investor," and he approached Yahoo! last year with the same saber-rattling resolve.
He was initially intrigued by Microsoft's (Nasdaq: MSFT ) botched buyout bid, and he established a 50 million-share stake in Yahoo! when it was priced in the mid-$20s. He figured he could slap on some Cupid wings and get the two companies to rekindle their buyout sweet talk. Icahn wanted at least $34.375 a share for Yahoo!, a greedy request when Microsoft had withdrawn its original $31-per-share offer.
His quiver was dry of arrows: Microsoft really meant it when it broke things off.
Yet instead of admitting defeat, Icahn was enraged. Unfortunately, he has found himself rooting for other losing ideas along the way.
- He proposed a new slate of Yahoo! directors. That wish didn't materialize.
- He backed an advertising partnership with Google (Nasdaq: GOOG ) , but that idea fell through.
- He championed a search partnership with Microsoft. He got that one, but the market hated it, and Yahoo! shares took a hit on the news.
Icahn doesn't always get it right. For every BEA Systems that he gets right -- Oracle (Nasdaq: ORCL ) bought BEA -- there's a Blockbuster (NYSE: BBI ) , Motorola (NYSE: MOT ) , or Yahoo! that goes the wrong way.
You don't have to hit it out of the park every time: The occasional homer will offset a handful of strikeouts. However, sometimes it just doesn't pay to be an activist. There's nothing wrong with "billionaire passive investor" as a tagline.
The world according to Yahoo!: