The turnaround plan recently outlined by Mayer has left at least two major shareholders very unhappy indeed, according to a media report. Officially there have been no talks between the two companies, but a Reuters report has claimed that AOL, Inc. (NYSE:AOL) CEO Tim Armstrong would be willing to consider a friendly merger. The report also claimed that two major AOL shareholders have discussed a potential deal with Yahoo! Inc. (NASDAQ:YHOO) with CEO Armstrong.

Angry Yahoo! Inc. Investors Appeal For AOL Rescue

Yahoo – AOL merger: Increasing pressure

Activist investor Starboard Value LP sparked speculation of a merger back in September, when it claimed that a deal could lead to cost synergies of up to $1 billion. The company wrote to Mayer, arguing that Yahoo was “deeply undervalued relative to the sum of its parts.”

The letter continued to criticize Mayer, calling the Alibaba stock sale “ill timed” and questioning her acquisitions strategy. However it maintained that Yahoo’s core business was valuable.

The Yahoo! Inc. (NASDAQ:YHOO) CEO responded by saying she would review Starboard’s opinions carefully, and mentioned stock buybacks and her desire to create shareholder value.

Strong performance by some measures

It is hard to criticize Mayer in that regard seeing as her time as CEO has seen shares in Yahoo more than triple in price. Criticism arises from the fact that the core business is struggling. Difficulties have arisen in the company’s digital advertising business, with revenue of the legacy business rising only 1% in the third quarter.

In contrast the mobile business has been helped by Mayer’s acquisitions, and is expected to reach $1.2 billion in revenue this year. Acquisitions, as well as the appreciation of Yahoo! Inc. (NASDAQ:YHOO)’s Asian assets, have had a great deal to do with the increase in the company’s share price.

Despite opposition from investors, there are still those who regard Mayer highly. She comes in at number 6 on Fortune’s “40 Under 40? list, as well as featuring at number 16 on the list of “Most Powerful Women.”

With increasing pressure from activist investors and a receptive CEO in Tim Armstrong, it might not be long until we hear of official talks between the two companies.