BA says no evidence global IT outage caused by cyber attack
LONDON, May 27 British Airways said on Saturday there was no evidence that a global breakdown of its IT systems had been caused by a cyber attack.
NEW YORK/SEATTLE Members of Microsoft Corp's board have held talks with ValueAct Capital Management LP in recent days over the activist shareholder's demands to secure a seat on the company's board, two sources close to the matter said on Friday.
ValueAct, which wants a say in the way the world's largest software company is adapting to the new world of mobile computing, is seeking to nominate a person from its own organization, the sources said.
The news comes as Microsoft had its biggest sell-off in four years, wiping $34 billion off its market value, after quarterly results were hit by weak demand for its latest Windows system and poor sales of its Surface tablet.
San Francisco-based ValueAct, which manages more than $10 billion for clients, owned 33 million Microsoft shares as of March, which is 0.4 percent of total shares outstanding, but it is believed to be buying more.
The fund, co-founded by finance industry veteran Jeff Ubben in 2000, has made a reputation for building stakes in companies and working with management in private to change fundamental strategy. ValueAct's other major holdings include Adobe Systems Inc, Motorola Solutions Inc and Valeant Pharmaceuticals International Inc.
In recent months a number of Microsoft's top institutional investors have contacted ValueAct, expressing concern over management execution and strategy, the sources said.
High among the issues in the talks, which the sources described as ongoing, is the apparent lack of succession planning at the top of the company. Steve Ballmer has held the chief executive job since 2000 and shows no signs of relinquishing it.
Ballmer, 57, once remarked that he envisaged staying on until his youngest child goes to college, which would be around 2017 or 2018, but since then he has not publicly addressed the matter.
ValueAct and Microsoft declined to comment. The software company has previously said there is a CEO succession plan in place, but has declined to give details of it.
Microsoft's huge stock drop on Friday, prompted by its financial results and a $900 million write-down on the value of unsold Surface tablets, provoked fresh skepticism of Ballmer's new plan to reshape Microsoft around devices and services.
"The recent reorganization does not fix the tablet or smartphone problem," Nomura analyst Rick Sherlund said in a note to clients on Friday. "The devices opportunity just received a $900 million hardware write-off for Surface RT and investors may not even like the idea of wading deeper into this territory."
ValueAct is thought to oppose Microsoft's recent foray into making its own devices.
Microsoft and Ballmer have been the targets of much criticism over the past decade, chiefly for falling behind Apple Inc and Google Inc in the shift toward mobile computing.
The company, however, has not been subjected to much overt protestation from shareholders. The most public challenge came two years ago, when Greenlight Capital's David Einhorn, who made his name warning about Lehman Brothers' financial health before the investment bank's collapse, called for Ballmer to step down.
Microsoft never responded publicly to that call, and the company's board has never indicated any major disapproval with Ballmer's performance, although it did trim his bonus last year for sagging Windows sales and a mistake that led to a massive fine by European regulators.
ValueAct may find it difficult to stir up change at Microsoft, even if it does get a seat on the board, given that co-founder and Chairman Bill Gates has long been a solid supporter of his old friend and colleague Ballmer.
Gates, who founded Microsoft in 1975 with Paul Allen, still owns about 4.8 percent of the company and is the largest individual shareholder. Ballmer, who is also on the board, owns about 4 percent.
Alongside Gates and Ballmer, seven independent directors make up Microsoft's nine-person board. The lead independent director is John Thompson, a former Symantec Corp and IBM executive.
Microsoft's shares closed down 11.4 percent at $31.40 on Nasdaq on Friday, but recovered slightly to $31.58 in after-hours trading, after the news that board members were in talks with ValueAct.
(Reporting by Nadia Damouni in New York and Bill Rigby in Seattle; Editing by Edward Tobin, Gary Hill, Toni Reinhold)
LONDON, May 27 British Airways said it had cancelled all flights from London's Heathrow and Gatwick airports scheduled before 1700 GMT on Saturday due to a global computer outage.
LONDON, May 27 British Airways flights in Britain were being delayed and passengers were suffering long waits at airports on Saturday because of a global system outage, the airline said.