On Sunday, Yahoo announced the appointment of three new directors hand-picked by the company.Brendan McDermid/Reuters
Daniel Loeb, chief executive officer of hedge fund Third Point LLC, said he would continue to push to revamp Yahoo Inc.'s board of directors following Yahoo's decision to reject him as a board member.
In a letter to Yahoo CEO Scott Thompson on Wednesday, Mr. Loeb blasted Yahoo for excluding shareholders from its board and accused the company of "making a mockery" of sound corporate governance principles.
Third Point, Yahoo's largest institutional shareholder with a 5.8-per-cent stake, has launched a proxy fight to appoint four directors to the struggling Internet company's board of directors.
On Sunday, Yahoo announced the appointment of three new directors hand-picked by the company.
Yahoo also said its board had offered to propose one of Third Point's four nominees, Harry Wilson, and a second person acceptable to both Yahoo and Third Point to join the board in order to avoid a proxy fight.
But Yahoo said giving a board seat to Mr. Loeb would not be in the best interest of the company.
In his letter, Mr. Loeb took issue with Yahoo's reason for rejecting him, which he said was based on the notion that he would not be "additive" to the board and that he would be "conflicted" because of his stake in Yahoo.
"It is absurd to assert a 'conflict' that would render a board member unqualified based either on ownership or a sense of urgency to repair a company that has been – by your own admission – languishing for years," Mr. Loeb wrote.
He said his firm remained willing to "engage further," but "will not deviate from our demand for badly needed shareholder representation."