Rumor: ValueAct wants a seat on Microsoft's board


Microsoft CEO Steve Ballmer may have to deal with an activist investment firm on the company's board.

In April, it was revealed that the activist investment firm ValueAct Capital Management had bought a $2 billion stake in Microsoft. While there was speculation at the time that the leader of ValueAct, Jeffrey Ubben, was planning an effort to get rid of Steve Ballmer as Microsoft's CEO, Ubben later said that they had no plans to interfere with Microsoft's future strategies.

Now those plans from ValueAct may have changed. Reuters reports, via unnamed sources, that the firm has been in talks with Microsoft about possibly putting in a representative from ValueAct on Microsoft's board of directors. Neither ValueAct and Microsoft commented on the claims.

If true, this would seem to signal a more hands-on approach from ValueAct in regards to influencing Microsoft's future plans. The report comes on the heels of Microsoft's latest financial results, where it took a one time $900 million charge because of a price cut on its Surface RT tablet. The news caused Microsoft's stock price to plummet 11.40 percent in trading on Friday. Reuters claims that ValueAct may be opposed to Microsoft launching its own computers.

Source: Reuters | Image via Microsoft

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23 Comments

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This is a great thing. this will help MS from making stupid mistakes. If an investor is involved, they should help decide what their money does

I'm very much against this. Letting people who don't know much about the market and have no passion for IT make decisions for MS. I wonder what they think about MS Research for example.

chrisj1968 said,
This is a great thing. this will help MS from making stupid mistakes. If an investor is involved, they should help decide what their money does

How does this prevent Microsoft from making stupid mistakes. These are investors, they have no knowledge on the matter at hand, and should be as far away as possible from interfering, otherwise the quarter after quarter of growth at Microsoft might be a thing of the past.

It's plain and simple, Ballmer needs to go!

Yes they might be doing great financially however their image has taken a massive beating, consumer confidence is at an all time low and getting worse every day.

actually consumer confidence over the last little while has been good, MS are actually listening to there customers, probably more then they should and it actually has results in what ms is doing. Ballmer isn't going anywhere, he makes the company piles of money, anyone that says he needs to go does not know how large corporations run.

korupt_one said,
MS are actually listening to there customers

I swear I was almost in tears from laughing so hard when I read that.

The point of organizations like this is to buy a bunch of shares, force the company into firing a lot of people, and then take the profit on the increased valuation with the cost cutting.

I am guessing the share of Ballmer is actually bigger than the share of this firm, but I guess it is amusing to report it.

Gates also still holds 6.4% and I'm pretty sure he rather has Ballmer the CEO then someone else.
Hate to break it to those that want to see Ballmer gone, but he's one of the best rated CEO's ever. Increasing MS's income by over 200% is not nothing and is something 99% of the CEO's in the world can only dream of achieving that for their company.

Shadowzz said,
Gates also still holds 6.4% and I'm pretty sure he rather has Ballmer the CEO then someone else.
Hate to break it to those that want to see Ballmer gone, but he's one of the best rated CEO's ever. Increasing MS's income by over 200% is not nothing and is something 99% of the CEO's in the world can only dream of achieving that for their company.

Exactly! It's just that it's so easy to he a hater these days.

sjaak327 said,
I am guessing the share of Ballmer is actually bigger than the share of this firm, but I guess it is amusing to report it.

At the end of the day it all comes down to which "group" has more voting shares.....

Fritzly said,

At the end of the day it all comes down to which "group" has more voting shares.....

Based upon the tiny amount of shares this firm bought, they won't be able to have more voting shares without other shareholders agreeing and working with them. Shareholders, a necessary evil, best to keep at bay. (Unless you want to run your business into the ground).

They're under no risk of not surviving. The big bucks are in the business software where hardware has razor thin margins. The problem with completely ditching consumer is kids growing up now will become decisions makers in business later.

Spicoli said,
......

Precisely why XBOX ONE needs to be a hit.
Microsoft certainly are under risk. The rise of tablets and other portable devices in conjunction with other cloud based service providers certainly has them worried.

In my neighbourhood alone, businesses are now powered by salesforce.com and other competing business services because the perceived buy-in to the MS infrastructure is too great for most companies.

The new generation of users don't care who is providing the service as long as the functionality is there.

As soon as Microsoft realise this, they will find the proper balance.