The curtain is rising on the next installment of the Yahoo soap opera. We now know why Yahoo didn’t crash and burn after Microsoft walked out and slammed the door. Yahoo wasn’t walking on water. Carl Icahn (pictured), the greatest stockholder activist of our generation, was reportedly busily pouring a billion dollars into its stock, buying around 50 million shares, roughly a 3.5%, 3.6% position, and keeping the price up.

And now, on the eve of the deadline to nominate a board to replace Yahoo’s, both Reuters and the Wall Street Journal are reporting that Icahn is going to pull the pin to try to force Yahoo into negotiating a deal with Microsoft – even though Microsoft reportedly won’t pick up the phone to Icahn, suggesting that Yahoo may have to crawl on its belly over broken glass to get Microsoft’s attention.

Much has been hung on Craig Mundie’s remark last week that Microsoft might reconsider a friendly takeover for $33 a share.

The Journal hears Icahn’s got 10 on his slate, including former Viacom CEO Frank Biondi, two short of the whole Yahoo board. Reuters says it’s a slate of 12, aiming for a complete sweep.

It’s unclear whether Yahoo’s two biggest shareholders Capital Research & Management and Legg Maison Capital Management, outspoken in their criticism of Jerry Yang and the Yahoo board since they blew the deal but lacking the stomach for a proxy fight of their own, will support Icahn.

Icahn reportedly wants to stop any deal between Yahoo and Google, which reportedly doesn’t look likely this week anyway, lest Microsoft take offense.

The Yahoo stockholders meeting is set for July 3. Sitting directors who don’t win a majority of the votes have to offer to resign.

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