14 DAY TRIAL // ValueAct Capital, the investing firm that purchased a 1 percent Microsoft stake in April, is said to be behind CEO Steve Ballmer's decision to retire, as the company's founder does not agree with the new vision of the tech giant.
Microsoft analyst Rick Sherlund told The Seattle Times in an interview that ValueAct had long tried to get a seat in the company's board in an attempt to replace Ballmer, even though no public statement on this has been released.
Sherlund, however, notes that ValueAct has even threatened the board with a proxy battle for a board seat in case Microsoft does not replace the CEO.
“It’s not clear how big a role ValueAct played here, but I suspect they were a strong catalyst for change,” Sherlund was quoted as saying by the source. “Threatening to go out and conduct a proxy contest is the equivalent to dragging (Steve) Ballmer as well as the board and Bill (Gates) through the mud for what’s happened to the company over the last 10 years.”
While ValueAct refused to comment on the matter, Steve Ballmer quickly denied the report, saying that his decision had nothing to do with the new investor. No other reason has been provided, though.
“No. My retirement has nothing to do with that,” Ballmer said. “My retirement has everything to do with what I think is the right long-term timing for Microsoft.”
ValueAct, on the other hand, is believed to be pursuing even more changes at Microsoft, including not only the departure of the existing CEO, but also abandoning some specific divisions.
Citing sources close to the matter, Sherlund revealed that ValueAct Capital believes that Microsoft should get rid of the Xbox unit, so selling it to another tech company would allow the tech giant to focus more on the products that count the most, including Windows and enterprise services.