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The move comes after the internet company rejected Microsoft's latest proposal to buy its search business.

Icahn, who owns about 5% of Yahoo and is working

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with Microsoft, reiterated earlier statements that Microsoft chief executive Steve Ballmer was no longer willing to negotiate with Yahoo's current board.

"We believe that NOW IS THE TIME TO ENTER INTO A SIGNIFICANT TRANSACTION WITH MICROSOFT," Icahn wrote in a letter to Yahoo shareholders.

Icahn told shareholders that he "strongly" believed that if his slate was elected, Microsoft would be willing to present Yahoo shareholders with either a "purchase offer for the whole company or a very attractive offer to purchase 'Search' with large guarantees."

On Saturday, Yahoo rejected Microsoft and Icahn's latest offer to buy its search advertising business. Sources familiar with the matter told Reuters that a deal would have guaranteed Yahoo $2.3 billion in annual ad revenue for five years.

Yahoo said it was given less than 24 hours offer to agree to the offer, which it described as "ludicrous".