While Microsoft declined to confront Yahoo!'s board of directors with a proxy battle, billionaire investor Carl Icahn is preparing to do just that. And if the activist shareholder is successful in removing Yahoo!'s current board, those close to Mr. Icahn say he'll then attempt to restart merger talks with Microsoft.

Icahn has purchased 50 million Yahoo! shares since the Microsoft offer was rescinded and he will allegedly decide today whether to try and oust Yahoo!'s board. (The deadline for Yahoo! board nominations is tomorrow.) His stake in Yahoo! is now worth over $1 billion.

One problem, however, is that Microsoft has shown little interest in Yahoo! since abandoning its bid for the company. The software has no official comment about Icahn's emerging plans and points to Steve Ballmer's statement from last week explaining why it has given up on Yahoo!. And Icahn's recent overtures to Microsoft have apparently been ignored.

Without Microsoft's involvement, it's unclear what Icahn can hope to accomplish. Certainly, punishing Yahoo!'s current board for not more aggressively pursuing a Microsoft purchase would have a certain attraction. And there are still a number of large Yahoo! shareholders who desperately want to consummate the Microsoft deal.

"Unless Microsoft is willing to come back and discuss a deal, it is hard to see what additional directors or new directors would be able to accomplish on behalf of shareholders," says Bill Miller, the portfolio manager for Legg Mason, which owns 6 percent of Yahoo!. Legg Mason is among those Yahoo! shareholders that wished to see the company sold to Microsoft. However, the company also believes that it was Microsoft, and not Yahoo!, that was responsible for last week's talks breaking down.

Will he or won't he? We'll know soon enough.