YAHOO co-founder Jerry Yang has quit the firm he started in 1995, appeasing shareholders who had blasted the Internet pioneer for pursuing an ineffective personal vision and impeding investment deals that could have transformed the struggling firm.

    Yang’s abrupt departure came two weeks after Yahoo appointed Scott Thompson its new CEO, with a mandate to return the once-leading Internet portal to the heights it enjoyed in the 1990s.

    Wall Street views the exit of “Chief Yahoo” Yang as smoothing the way for a major infusion of cash from private equity, or a deal to sell off much of its 40 percent slice of China’s Alibaba, unlocking value for shareholders.

    Yang, who is severing all formal ties with the company by resigning all positions including his seat on the board of directors, has come under fire for his handling of company affairs dating back to an aborted sale to Microsoft in 2008.

    The company did not say where Yang was headed or why he had suddenly resigned.

    Yang and co-founder David Filo, both of whom carried the official title “Chief Yahoo,” own sizable stakes in the company. Yang owns 3.69 percent of Yahoo’s shares, while Filo owns 6 percent as of April and May 2011.

    Yang said he was leaving to pursue “other interests outside of Yahoo” and was “enthusiastic” about Thompson as the choice to helm the company. Yang, 43, is also resigning from the boards of Yahoo Japan and Alibaba Group Holdings.(SD-Agencies)