Yahoo set to drop spinoff of Alibaba stake

AFP, SAN FRANCISCO: Yahoo has abandoned plans to spin off its large stake in Chinese online giant Alibaba, CNBC television reported Tuesday, citing unnamed sources.
The report said Yahoo had changed its position in light of uncertainly about the possible tax consequences of the transaction—a complex deal in which Yahoo would establish a new entity to hold the Alibaba shares.
The California Internet pioneer is now exploring a different strategy that would sell off its “core” operations, according to CNBC.
But such a plan would be more radical and likely end Yahoo in its present form, some three years into a turnaround effort by chief executive Marissa Mayer.
There was no immediate comment on the report from Yahoo.
Yahoo’s market value based on its share price is more than $32 billion, but most of that is based on the value of its Alibaba holdings.
The core business—which includes the company’s Internet search component and a range of online advertising and digital media operations—are essentially worthless based on Yahoo’s market value.
Last month, a hedge fund with a stake in Yahoo called on the company to sell its core business as a way to unlock more value for shareholders.
Earlier Tuesday, Verizon’s top executive left open the possibility that the US telecom giant could make a bid for Yahoo.

Yahoo set to drop spinoff of Alibaba stake

AFP, SAN FRANCISCO: Yahoo has abandoned plans to spin off its large stake in Chinese online giant Alibaba, CNBC television reported Tuesday, citing unnamed sources. The report said Yahoo had changed its position in light of uncertainly about the possible tax consequences of the transactiona complex deal in which Yahoo would establish a new entity to hold the Alibaba shares. The California Internet pioneer is now exploring a different strategy that would sell off its core operations, according to CNBC. But such a plan would be more radical and likely end Yahoo in its present form, some three years into a turnaround effort by chief executive Marissa Mayer. There was no immediate comment on the report from Yahoo. Yahoos market value based on its share price is more than $32 billion, but most of that is based on the value of its Alibaba holdings. The core businesswhich includes the companys Internet search component and a range of online advertising and digital media operationsare essentially worthless based on Yahoos market value. Last month, a hedge fund with a stake in Yahoo called on the company to sell its core business as a way to unlock more value for shareholders. Earlier Tuesday, Verizons top executive left open the possibility that the US telecom giant could make a bid for Yahoo.