Yahoo move could add to turmoil

SAN FRANCISCO — Yahoo has set up a battle for control of its board by appointing two directors likely to further agitate an activist shareholder threatening an attempt to oust CEO Marissa Mayer unless she bows to demands to sell the company’s Internet operations.

The decision announced Thursday increases the likelihood that the unhappy shareholder, Starboard Value, will nominate an opposing slate to run against Yahoo’s board of nine directors in a proxy fight.

If the confrontation occurs, it would escalate the challenges already facing Mayer and the rest of Yahoo’s board as they try to reverse a prolonged fall in the company’s revenue and figure out a way to avoid paying taxes on the gains from a roughly $28 billion stake that it holds in China’s e-commerce leader, Alibaba Group.

Starboard had been seeking seats on Yahoo’s board without a proxy fight, but that seems unlikely to happen now that Yahoo has filled two vacancies that recently opened up with the resignations of PayPal co-founder Max Levchin and discount stock brokerage pioneer Charles Schwab.

Yahoo named former Morgan Stanley investment banker Catherine Friedman and Eric Brandt, chief financial officer of chip maker Broadcom Corp., to fill those spots.

Starboard Value didn’t respond to a request for comment. The firm has until March 26 to nominate its own candidates to take over Yahoo’s board. If Starboard Value seized control of Yahoo’s board, it could then fire Mayer, who has been the company’s CEO since July 2012.