RSS LinkedIn Google Plus

Call us: 0800 014 9884

Alibaba and Yahoo announce buyback deal

Alibaba_and_Yahoo_announce_buyback_deal_10891

Yahoo selling off assets

Chinese internet giant Alibaba Group will buy back half of Yahoo’s stake in the company, it was announced today.

Alibaba founder and CEO Jack Ma will buy back 20 per cent of total shares in the company, half of the 40 per cent stake that Yahoo has held since 2005. The price tag of $7.1bn (£4.5bn) includes $6.3bn in cash and $800m in stock, and is in keeping with Alibaba’s most recent valuation of $35bn. The Financial Times also reports that Alibaba will pay $550m for use of the Yahoo China trademark, although it has owned the web property since 2005.

The strategic partnership between the two companies was a result of close ties between Jack Ma and Yahoo co-founder Jerry Yang. However, the buyback deal has been a long time coming, as talks initially began when CEO Carol Bartz was fired in September 2011. The departure of CEO Scott Thompson last week does not seem to have affected the deal.

Alibaba on the market?

The buyback deal is good news for the Alibaba Group, as analysts believe it paves the way for an IPO – selling its shares on the stock market. Yahoo is set to sell another ten per cent of its stake at that point, while it may retain the final ten per cent until after the IPO. Insiders say the floatation is scheduled for 2015.

Of course, the deal is also favourable for Yahoo, as the company has been struggling to raise funds recently – resorting to 2000 layoffs in April. Selling off assets in Asia has long been considered a potential way of turning around the company’s fortunes – analysts believe Yahoo Japan could be next on the agenda.

Richard Frost, managing editor at theEword, commented: “The buyback deal is great news for Alibaba, but even more so for Yahoo. The last few months have been something of a nightmare for the company, but this is a step in the right direction. It’s also a good first move for new CEO Ross Levinsohn, and should get the shareholders off his back for the time being.”

Written by rachel_hand_swapRachel Hand

Testimonials

"theEword soon became an essential extension to our internal online marketing team."

~ Screwfix Bathrooms ~

  Screwfix Bathrooms

"We are extremely happy with the online visibility achieved through SEO and PPC."

~ Pure Student Living ~

  Pure Student Living

"theEword has consistently produced great results; very happy with the service."

~ Parasol ~

  Parasol

"theEword team has excelled itself in terms of client service, campaign measurement and responsiveness."

~ Linder Myers ~

  Linder Myers

View more of our testimonials »

james_riches_swap

Schmidt defiant on Google privacy efforts Monday 15th of December, 2014by James Riches Google chairman Eric Schmidt has outlined how the company responded in the wake of Edward Snowden’s shock revelations last year, including increased security and privacy measures.

More on this story »

Bing search results removed from Facebook Tuesday 16th of December, 2014by Andy Williams Facebook has completely removed Bing results from its internal search engine, instead focusing heavily on the improvement of their own search capabilities.

More on this story »

Google announces trending topics and videos feature Wednesday 17th of December, 2014by Martin Lindley The new feature is available in over 50 languages and allows users to deeper explore trending topics: to do so the user clicks on a trend of interest to them.

More on this story »
theEword - 6 hours ago

Read our latest Eweekly wrap here: http://t.co/WkZKyDq4w8

Reply Retweet Favourite
theEword - 10 hours ago

We are ready for our Christmas buffet! :-) http://t.co/a8jddlOBiu

Reply Retweet Favourite
theEword - 14 hours ago

We already have one very cool Christmas Jumper this morning! http://t.co/jCkWMcQqjd

Reply Retweet Favourite
theEword - 1 day ago

Marketers: if you could send a message to yourself back in time to the start of 2014, what would it say? http://t.co/9kqlzuN11W

Reply Retweet Favourite
theEword - 2 days ago

Google announces trending topics and video feature: http://t.co/GYYJRatwKR

Reply Retweet Favourite

theEweekly Wrap: 12 Dec Friday 12th of December, 2014by Martin Lindley This week: Google Penguin gets live updates, Microsoft accepts bitcoin, and old iPod sells for thousands.

More on this story »
daniel_nolan_swap

Google Zeitgeist 2014 list reveals the world's search intere... Tuesday 16th of December, 2014by Daniel Nolan See the search terms the world has been looking for this year with Google's 2014 Trends.

More on this story »

theEweekly Wrap: 19 Dec Friday 19th of December, 2014by Dan Moores This week: The US thinks North Korea hacked Sony, IBM succeeds in cloud computing, and Google fights antitrust lawsuit.

More on this story »

Who loves theEword

Who loves theEword Who loves theEword