Yahoo!'s Upside: Only Angry Shareholders

Legg Mason, Yahoo's third-largest shareholder, has already said that it will support the company's current board, which may have influenced Icahn's decision to abandon his proxy fight.

Icahn admitted on Thursday that he realized he didn't have enough votes from institutional investors to win his battle, leading him to work out a compromise with Yahoo!.

"In today's corporate governance system where large mutual funds control so much of the stock, it is extremely difficult to oust an entire board, no matter how strongly a large number of shareholders feel about the board's previous actions," he said in a statement. "Realizing I could not gain control, I saw no point in spending the final two weeks in a debilitating fight, where little would be accomplished except to build animosity between both camps and the end result would be no better than the compromise that was reached."