US internet company Yahoo said it has reached a deal to sell part of its stake in the Chinese e-commerce firm Alibaba Group.
Alibaba will buy back half the 40% stake owned by Yahoo, following months of negotiations.
The deal will raise about $7.1bn (£4.5bn) for Yahoo, which has been losing ground to rival Google and Facebook in online advertising.
The agreement also allows Alibaba to consider an initial public offering.
Both companies revealed in a statement that Alibaba will pay Yahoo $6.3bn in cash and up to $800m in Alibaba preferred stock.
For Yahoo, the deal gives it the ability to pay dividends, make acquisitions, or buy back its own shares, something its stockholders have been asking for.
"We look forward to delivering the proceeds of the near-term transaction to our shareholders," said Timothy R Morse, chief financial officer at Yahoo.
The agreement also allows the Chinese group to buy more of Yahoo's remaining 20% stake, if Alibaba pushes ahead with a sale of its own shares on the stockmarkets, a move that many observers expect.
No comments:
Post a Comment