Jerry Yang Trying to Buy Yahoo! Back

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Following the rather public management coup at Yahoo! earlier this week, there are rumors that the company is ripe for acquisition or takeover. But even as the company is experiencing some infighting among its board of directors, co-founder and former CEO Jerry Yang is trying to make a bid for control once again.

Yahoo! isn’t currently in the best position in the market in its core products. But while the company has fast been overtaken by competitors in the search and social business, Yahoo! is still a big name when it comes to content. This is why the company badly needs a makeover — it does have the resources, but not the direction that it needs to be at top spot once again.

There are a handful of speculations about what will happen to Yahoo! management at this point. One of these is a potential takeover bid by co-founder Jerry Yang, who is a major shareholder. But as Yang owns only about 3.63% of the company, he will have to look for allies to execute this plan. Fellow co-founder David Filo — who owns 5.80% — is likely to be an ally, although Yang is said to be in conflict with Yahoo! Chairman Roy Bostock.

Whatever Yang plans, he will definitely need to raise enough capital to acquire enough shares of Yahoo! stock to gain control. It’s even speculated that Yahoo! will go private — a move that might help the company become better-able to restructure its management and business, and find its direction anew. If they are successful, then Yahoo! might be able to rise from the ashes, so to speak, and go public again with a stellar IPO.

Yahoo! is currently in hot water with some of its investors, such as hedge fund Third Point, which owns 5.1% of Yahoo! stock. Third Point had it right when they wrote that the want Yahoo!’s current board of directors out, stressing that they had consistently failed in finding the right strategies for the company, including hiring Carol Bartz as CEO in the first place, supporting her for so long, and turning down a $44.6 billion acquisition offer by Microsoft in 2008 (Yahoo! is currently valued at about $22 billion).

Where Yahoo! will be going at this point is still a big question mark. While competitors like Google, et al, are ramping up their efforts in mobile, social applications and other services, Yahoo! will have to resolve a lot of corporate governance issues first. Jerry Yang once held the reins as Yahoo! CEO, but will a possible comeback mirror that of Steve Jobs’ famous “second act” at Apple?