After Yahoo ripped at him last Monday, you knew it wouldn't be long before Carl Icahn came roaring back. But Icahn wisely waited until after the July 4 weekend, getting the maximum bang out of his revelation that he's been chatting with Microsoft boss Steve Ballmer.

Here's the parse.

Icahn: Dear Yahoo! Shareholders:

Translation: I no longer talk to the Yahoo board or management.

Icahn: During the past week I have spoken frequently with Steve Ballmer, CEO of Microsoft.

Translation: I finally got through the switchboard.

Icahn: Several of our conversations have lasted as long as an hour.

Translation: Steve is a patient listener.

Icahn: Also, a few of our discussions have taken place while other top executives, such as Kevin Johnson, participated.

Translation: There are witnesses.

Icahn: Our talks centered on the industry in general but, more importantly, on how Yahoo! and Microsoft can do a transaction together.

Translation: Our talks were carefully crafted to avoid illegalities.

Icahn: Steve made it abundantly clear that, due to his experiences with Yahoo! during the past several months, he cannot negotiate any transaction with the current board.

Translation: Nor will he try to kick the football Lucy has teed up.

Icahn: His logic is simple.

Translation: I need him so badly.

Icahn: If and when a transaction was consummated, Microsoft would be guaranteeing a great deal of capital at closing. However, a transaction could take at least nine months and perhaps longer to obtain regulatory clearance in the U.S., Europe, and elsewhere. During that period, if the current board and management team of Yahoo! mismanage the company (and their recent track record is far from reassuring), Microsoft would be putting its money at risk and a great deal could be lost.

Translation: The self-mutilation efforts could evolve into a full-blown suicide attempt.

Icahn:For example, in a transaction to purchase the whole company, a very large amount of capital would be due at closing. Even in an "alternate" transaction, where just the "Search" assets were purchased, large guarantees would have to be made and, again, large sums could be lost if the company was mismanaged.

Translation: Sometimes I just cannot restrain myself from repetition.

Icahn: Microsoft perceives this risk may be quite high with the current board and management in place.

Translation: The animosity could not be more personal.

Icahn: However, Steve made it clear to me that if a new board were elected, he would be interested in discussing a major transaction with Yahoo!, such as either a transaction to purchase the "Search" function with large financial guarantees or, in the alternative, purchasing the whole company.

Translation: Microsoft was my only hope. Now, I am the shareholders' only hope.

Icahn: He stated that Microsoft would be willing to enter into discussion immediately if the new board that has been nominated were elected.

Translation: The lawyers have already drafted the documents.

Icahn: While there can be no assurance of a future transaction, as many of you know, I have negotiated successfully a large number of transactions over the past years.

Translation: This will be a clinical, mathematical function.

Icahn: If and when elected, I strongly believe that in very short order the new board would, subject to its fiduciary duties, be presenting to shareholders either a purchase offer for the whole company or a very attractive offer to purchase "Search" with large guarantees.

Translation: I asked him what it would take for him to drive this baby off the lot on August 1.

Icahn: I hope to continue to be speaking to Steve over the next few weeks; however, since I do not as yet represent the Yahoo! board, both Steve and I do not wish to get into details over price, or even which of these transactions makes the most sense.

Translation: We've taken our conversation as far as our lawyers will let us.

Icahn: Much has been said about how badly the Yahoo! board has "botched up" negotiations with Microsoft over the past months.

Translation: Much of it has been said by me.

Icahn: There is no need to keep pointing out the mistakes I believe Yahoo! made by not immediately taking a $33 offer made by Microsoft.

Translation: My repetitious letters were starting to lose their impact.

Icahn: But one thing is clear -- Jerry Yang and the current board of Yahoo! will not be able to "botch up" a negotiation with Microsoft again, simply because they will not have the opportunity.

Translation: Steve would never change his mind.

Icahn: Our company is now moving toward a precipice.

Translation: The vote is less than a month away.

Icahn: It is currently losing market share in its "Search" function; our current Board has failed to bring in a talented and experienced CEO to replace Jerry Yang and return Jerry to his role as Chief Yahoo!, and currently it is witnessing a meaningful exodus of talent.

Translation: Why would a grown man want to be called a "chief yahoo?"

Icahn: It is no secret that Google (which hired a great operator as CEO) continues to dramatically outperform Yahoo!. According to publicly available information, Google's income from operations grew 59% per year over the last two years while Yahoo!'s shrank 21% per year. However, none of the above has caused the Yahoo! board to hesitate in paying themselves $10,000 per week.

Translation: We are selling a depreciating asset.

Icahn: IT IS TIME FOR A CHANGE.

Translation: YES, ICAHN. I MEAN, YES, WE CAN.

Icahn: If elected, I have little doubt that the new board, subject to its fiduciary duties, will do what the current board will not do, i.e., immediately start negotiation with Microsoft to sell the whole company or, in the alternative, sell "Search" with large guarantees...move expeditiously to replace Jerry Yang with a new CEO with operating experience.

Translation: You'll all know the sell price before you go to the Hamptons.

Icahn: Sincerely yours, CARL C. ICAHN

Translation: Sincerely yours, STEVE'S FRIEND