Home杭州桑拿 › Yahoo to exit internet business and keep Alibaba stake, CNBC says

Yahoo to exit internet business and keep Alibaba stake, CNBC says

Internet search giant Yahoo may soon not run it internet business anymore. Photo: iStockYahoo Inc is weighing a sale of its core internet business and will not sell its stake in Chinese e-retailer Alibaba Group, CNBC reported, a sharp reversal that came after pressure from an activist investor.
Shanghai night field

The moves, which CNBC said could be announced as soon as Wednesday, represent a stark rejection of chief executive Marissa Mayer’s plans to sell the Alibaba stake and revive its internet business focusing on growing mobile, video and social media ads.

Yahoo could not immediately be reached for comment.

Yahoo’s shares rose more than 2 per cent in after-hours trading. Alibaba’s shares rose 1.3 per cent.

Yahoo’s core business consists of its news sites, popular email service and products like Tumblr and its advertising technology.

The CNBC report, which cited sources, did not disclose a possible price. Analysts and bankers have estimated the unit could fetch between $US2 billion ($2.76 billion) and $US8 billion, with many seeing $US4 billion as the likely price.

Private equity, media and Internet firms are potential buyers, they said.

The latest news came after a three-day meeting of its board of directors last week. Yahoo faced pressure from activist investor Starboard Value to sell the core business rather than proceed with the planned spin-off of its $US30 billion stake in Alibaba, which could trigger large tax payments.

“This was really a really good PR move by Starboard as the spinoff was highly unlikely anyway given the tax implications and they knew they could claim victory once Yahoo made the official announcement,” said Jim Osman of The Edge Consulting Group, a research firm that advises activist hedge funds.

Yahoo’s board met last Friday on the third and final day of meetings to consider various options for the company, including selling its struggling Internet business.

The company’s search and display ad businesses, which account for the lion’s share of its total revenue, have been struggling and Mayer’s efforts to revive the businesses have yielded few results.


Comments are closed.