Yahoo Shares Rise as Co-Founder Jerry Yang Resigns (YHOO)

Shares of Yahoo! Inc. (NASDAQ: YHOO), the online media company, are gaining in early trading today after the Sunnyvale, California-based company said that its co-founder, Jerry Yang, has resigned.

Yang co-founded Yahoo in 1995. His departure has pleased shareholders, who were upset with him for obstructing deals which could have transformed the struggling company.

Yang’s resignation comes two weeks after Yahoo announced the appointment of Scott Thompson as its new CEO.

Analysts believe that Yang’s departure from Yahoo clears the way for a major infusion from private equity firms or a deal to sell a major portion of the company’s stake in China-based Alibaba.

Macquarie analyst Ben Schacter told Reuters that everyone is going to assume this means a deal is more likely with the Asia counterparts. Schacter said that the perception among shareholders was Jerry was more focused on trying to rebuild Yahoo than necessarily on maximizing near-term shareholder value.

Yang will sever all his formal ties with Yahoo. He has resigned from all positions, including his seat on the Yahoo Board. Yang has been under fire from shareholders for his handling of the company’s affairs dating back to a failed deal with Microsoft Corporation (NASDAQ: MSFT).

Yahoo did not provide any details on why Yang has suddenly resigned from the company he co-founded. Roy Bostock, Chairman of the Yahoo Board, said that Yang is a visionary and a pioneer, who has contributed enormously to the company during his many years of service.

Scott Thompson, Yahoo’s new CEO, said that Yang leaves behind a legacy of innovation and customer for Yahoo, having shaped the company’s culture by fostering a spirit of innovation that began 17 years ago and continues to grow even stronger today.

Yahoo shares have risen sharply in early trading today. At last check, the stock was up 2.27% to $15.78 on volume of 5.53 million.

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Post Written By: Ed Liston Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.