REUTERS/Robert Galbraith
According to Microsoft's press release, "The cooperation agreement provides for regular meetings between Mason Morfit, president of ValueAct Capital, and selected Microsoft directors and management to discuss a range of significant business issues"
Additionally, "The agreement also gives ValueAct Capital the option of having Morfit join the Microsoft board of directors beginning at the first quarterly board meeting after the 2013 annual shareholders meeting."
Essentially, this clears the way for Morfit to join Microsoft's board next year.
ValueAct has invested $1.9 billion in Microsoft, an 0.8% stake. It reportedly wants to see Microsoft do more with its $77 billion in cash. A bigger dividend, or a buyback is reportedly preferred.
The timing of this announcement is turning some heads.
It is the Friday before a long Labor Day weekend. Relatively few people will see this news. Today was the deadline for any proxy contests, so this was always due for a Friday announcement, unless Microsoft and ValueAct had wrapped negotiations early.
Further, this is one week after CEO Steve Ballmer announced his retirement.
Ballmer was asked directly if ValueAct had anything to do with his retirement. His answer: "No ... My retirement has nothing to do with that. My retirement has everything to do with what I think is the right long term timing for Microsoft."
Microsoft's agreement with ValueAct precludes it from having a say — at least at a board level — on who Microsoft's next CEO will be. By the time ValueAct is on the board, Microsoft will likely be well on its way to picking Ballmer's successor.