What happens when you combine two dying '90s internet relics into one conglomerate of uselessness? According an activist investor at Starboard Value, a proposed merger of Yahoo and AOL could see "significant appreciation" in Yahoo's stock price and the revitalization of both brands. How exciting!

Instructions to acquire the dial-up dinosaur came in an open letter from a firm with a "significant stake" in Yahoo, sent to company CEO Marissa Mayer:

Based on our analysis, we believe that a combination of Yahoo and AOL could offer synergies of up to $1 billion by significantly reducing the cost overlaps in their Display advertising businesses as well as synergies in corporate overhead. Importantly, we believe the combined entity would be able to more successfully navigate the ongoing industry changes, such as the growth of programmatic advertising and migration to mobile. In addition, we believe a combination could also lead to revenue growth opportunities given the broader user base, higher quality content, better technology assets, and enhanced relationships with advertising agencies.

Effectively, Starboard is saying the two companies could merge their competing products and layoff all the redundant employees. Plus, Yahoo would have the added benefit of getting "higher quality content" from AOL's content sweatshops to splash across their homepage.

Starboard also issued a few more recommendations. The firm asked Yahoo to reduce expenses by "$250 and $500 million" (more layoffs, presumably) and to stop spending millions buying up money-losing startups.

"Yahoo's recent strategy of focusing on acquisitions has not worked," Starboard writes.

The $1.3 billion spent on acquisitions has clearly not delivered value to shareholders. Not only do we believe that many of the acquired companies were, and still are, losing a considerable amount of money, but we also believe that these acquisitions, on a combined basis, have failed to deliver material revenue growth. In fact, we believe that a number of the acquired start-ups have actually been shut down after being acquired by Yahoo.

If Yahoo doesn't get its act together, they can at least go back to building parking lots.

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Photo: AP, h/t Wall Street Journal