Miller-Time for Yahoo?

Sam Gustin writes: It's no secret that former AOL chief executive Jonathan Miller wants a crack at running Yahoo, the beleaguered Web giant. He was set to join the company's board a few months ago as part of Carl Icahn's slate, before Time Warner nixed the idea, citing a non-compete clause in Miller's contract.

Miller is so confident that he can turn Yahoo around that he's out raising money from sovereign wealth funds and other investors in hopes of actually buying the company outright and taking it private, according to the Wall Street Journal. Miller currently runs venture capital shop Velocity Interactive Group.

Miller is working on a deal to offer Yahoo shareholders between $20 and $22 per share, valuing the company at about $30 billion -- well below Microsoft's final offer of $33 per share, but a nice premium above the $10 level the stock's been trading at recently, according to the paper. Yahoo shares jumped over 7 percent on the news.

Miller's gambit faces challenges -- not least of all an abysmal climate for raising capital -- but it has the virtue of bold-thinking, which is just what Yahoo needs at the moment. If Jerry Yang's failed tenure as chief executive showed anything, it's that Yahoo's salvation will require more than half-measures and incremental improvements.

Yahoo needs a leader to step into the vacuum and decide what kind of company it will be in the years ahead. That means streamlining its mission and corporate strategy as well as its disparate assets and units.

By taking Yahoo private, Miller would earn some breathing room to reboot the company, without irate shareholders breathing down his neck. Yes, he would be answerable to his other investors, but presumably he have assurances that he would be have some time to turn the company around.

The Journal report is pretty vague on the details, and it's entirely possible that this was a calculated leak to put pressure on Microsoft to come back to the bargaining table. Microsoft has indicated that it wants a new chief executive installed at Yahoo before it will return with a new bid for all or part of the company. The Journal reports that Miller has been trying to bring the companies together for months. He may be growing impatient.

Given the dearth of other suitors, Miller's offer -- if he can put it together -- would be attractive to Yahoo shareholders. No doubt he's got Carl Icahn's attention.