Yahoo to Spin Off Alibaba Stake Into New Company The tax-free spinoff is a response to shareholder pressure.

By Reuters

This story originally appeared on Reuters

Alibaba.com

Yahoo Inc unveiled a plan for a tax-free spin-off of its 15 percent stake in China's Alibaba Group Holding Ltd, responding to pressure to distribute to shareholders its prized investment valued at roughly $40 billion.

Shares of Yahoo were up roughly 7 percent at $51.45 in after-hours trading on Tuesday.

Yahoo said on Tuesday that its management has recommended to its board of directors a plan that would spin off the stake into a newly formed independent registered investment company. The stock of the company will be distributed pro-rata to Yahoo shareholders.

The new entity will include Yahoo's 384 million shares in Alibaba as well as an unspecified "legacy, ancillary" Yahoo business, the company said.

Yahoo, which is trying to reverse a multi-year decline in revenue, has faced increasing investor pressure more than two years after Chief Executive Marissa Mayer took the reins to lead a comeback plan.

(Reporting by Alexei Oreskovic; Editing by Christian Plumb)

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Most Popular

See all
Productivity

6 Habits That Help Successful People Maximize Their Time

There aren't enough hours in the day, but these tips will make them feel slightly more productive.

By Blake Johnson
Business News

'Feels Like a Slap in the Face': Some JPMorgan Employees Reportedly Aren't Happy With Their Bonuses

JPMorgan reported a record-high net income for 2024 of $58.5 billion.

By Sherin Shibu
Side Hustle

'$220,000 in 3 Months': These Friends — One a Former Apple Engineer — Started a Side Hustle By Revamping an 'Unruly, Ugly' Product in Their Garage

Cristina Ashbaugh and Kelly McGee launched Yardsale to solve a common but often overlooked problem.

By Amanda Breen
Leadership

Doing Well by Doing Good — How Purpose-Driven Entrepreneurs Are Changing the World

Exploring the transformative impact of mission-driven business leadership.

By Roy Dekel
Starting a Business

He Immigrated to the U.S. and Started a Business. It's 'Not the Sexiest' But Sells Over 6,000 Units Daily — Up to $25,000 Apiece — Anyway.

When 16-year-old Amir Loloi emigrated from Iran, he didn't intend to stay in the U.S. forever. Then those plans changed.

By Amanda Breen
Marketing

How You Can Master the Psychology of Sales With This Simple 4-Step Framework

Success in sales is not just about charisma or closing techniques—it's about understanding the psychology of your customers and guiding them through a structured process.

By Brian Will