AOL's $1 billion deal to sell patents to Microsoft is a good first step, but major shareholder Starboard Value still has "serious concerns" about AOL's "poor operating performance," the activist hedge fund says in a letter to the AOL board. For that reason, Starboard Value has filed with US regulators asking for three of its candidates to be nominated to AOL's board, Reuters reports.
Starboard had been pressuring AOL to auction its patents. While it is happy about the deal with Microsoft, Starboard believes all the proceeds should go to shareholders, while AOL has only promised a "significant portion" will. Says the letter, "We remain concerned that shareholder capital will continue to be used for poorly conceived acquisitions and investments into money-losing initiatives" such as Patch community news websites. (Read more AOL stories.)