What is a proxy fight? I read an article that Microsoft hired a company to vote a certain way at next board of directors meeting?
Shareholders get to vote on proposals for all sorts of things, usually at the annual meetings. Normally these are quite boring. Normally, the shareholders designate someone else to vote their shares for or against these proposals, and the form they use is a proxy. Usually, the proxy assigns someone on the Board or some executive to vote those shares at the meeting on the shareholder's behalf. There are proxy companies that are hired by the actual companies voting on the proposals -- these proxy companies send out the proxies, collect and tabulate the votes, etc.
Proxy fights occur when something really contentious comes up. In this case, the two sides of the fight can each hire a proxy company to solicit shareholder's proxy votes for their own sides. I was an HP shareholder when they had a proxy fight over whether or not to merge with Compaq. In that case, each side wanted to vote my shares, so they would send me propaganda about why their side was the best, and including a proxy card for me to sign my vote over to them. Each side sent me probably five or six proxy cards for each block of shares I had (I held shares in several different place). One side's proxy cards were green, the other side's were white. I believe my last executed proxy card for each block of shares was the "valid" one.
Probably -- haven't read the details yet -- MSFT has hired a proxy company to solicit votes for their pro-acquisition side of the argument, and Yahoo has hired another proxy company to solicit votes for their anti-acquisition side of the argument. There will also be, by implication, a Yahoo shareholder resolution asking whether Yahoo should be acquired by MSFT. (There may also be one at MSFT asking whether MSFT should buy Yahoo, but that vote is pretty much a foregone conclusion - it will be voted in.)
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