Yahoo's entire board of directors should be swapped out, per an activist investor, and the AP reports that Starboard Value is going to nominate nine new board members Thursday, ratcheting up tensions between itself and the beleaguered Internet giant. The Wall Street Journal says it reviewed a letter from Starboard, which says it has a 1.7% stake in Yahoo, in which it rails on Yahoo's board and management for not keeping promises and says they shouldn't get to decide whether Yahoo keeps going as an independent company. Yahoo has been scrambling to rectify internal issues, especially after Starboard warned earlier this year it wants CEO Marissa Mayer out and radical changes or a solid strategy for its sale. "We have been attempting to work with Yahoo for the past 18 months," the Starboard letter to investors reads, per the New York Times. "At every step of the way, management and the board have pushed us away."
While Mayer and Co. have been trying to revamp Yahoo's core business by slashing costs and refocusing on critical areas, Starboard notes "turning around this business is extremely difficult" and cites "interested and credible buyers," the Journal reports. Per Reuters, Starboard is "extremely disappointed with Yahoo's dismal financial performance, poor management execution, egregious compensation and hiring practices, and general lack of accountability and oversight by the board." Although Yahoo has reached out to possible buyers, including Verizon and Time Inc., Starboard's letter suggests it's being left out of the process (Starboard CEO Jeffrey Smith is on its nominees list) and adds "it seems little progress has been made." While such a complete takeover is rare, Starboard has done it before: In 2014, it cleared out 12 directors at Darden Restaurants and put Smith in the chairman's seat, Fortune reported at the time. (Read the entire letter at Fortune.)