Jack Ma could pay high price to be rid of Yahoo

Fri Dec 23, 2011 9:59am GMT

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By Wei Gu

HONG KONG Dec 23 (Reuters Breakingviews) - The Alibaba founder wants to buy back most of Yahoo’s stake in his e-commerce giant. An earlier spat over their payment unit Alipay showed Ma has nuisance value and may deter other bidders. But financing it won’t be easy. After selling at the bottom, he risks paying a peak price.

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CONTEXT NEWS

-- The board of Yahoo (YHOO.O) is considering a sale of the bulk of its holdings in the Alibaba Group of China, and Yahoo’s Japanese affiliate, back to their majority owners in a complex transaction that values the stakes at about $17 billion, according to the New York Times Dealbook, which first reported on the plan on Dec. 21.

-- The proposal values Yahoo’s 43 percent in Alibaba at about $12 billion, and its 35 percent stake in Yahoo Japan at about $5 billion. It could be executed either as a stand-alone deal or alongside a minority investment in Yahoo by private equity firms Silver Lake or TPG. Yahoo is expected to keep a 15 percent stake in Alibaba, according to Dealbook.

-- Reuters: Yahoo to weigh deals for Asian assets - sources [ID:nN1E7BK0FD]

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The author is a Reuters Breakingviews columnist. The opinions expressed are her own)

-- For previous columns by the author, Reuters customers can click on [GU/]

(Editing by John Foley and David Evans)

((wei.gu@thomsonreuters.com)) Keywords: BREAKINGVIEWS YAHOO/

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