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Alibaba seals US$7.6b Yahoo deal
By Ding Yining |
September 20, 2012, Thursday
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Print Edition
Print Edition
ALIBABA Group has completed a US$7.6 billion share buyback from Yahoo! Inc as China's biggest e-commerce firm continues to work toward a listing of the group.
Alibaba said it used US$6.3 billion in cash and US$800 million of preferred shares of the group to finance the deal. The remaining US$500 million is being paid to Yahoo under technology and patent licensing agreement.
"The completion of the share buyback will give the company a healthier share structure and also means Alibaba has entered a new development stage," said Jack Ma, Alibaba's chairman and CEO.
The deal values Alibaba at about US$40 billion, bigger than that of US-listed Baidu and Sina.
The move is seen as a further step by the group to take control of its stake structure after it completed the privatization of its Hong Kong-listed B2B unit Alibaba.com in June.
The deal will cut Yahoo's stake in the group to 23 percent from 40 percent previously.
External shareholders, including Softbank Corp and Yahoo, will have less than 50 percent of voting rights, handing more control over the company's future strategy to Alibaba management.
Feng Po, analyst of ChinaVenture Group, said: "The success of the buyback will help speed up Alibaba's strategy shift and also signals a key development in the group's overall listing."
Chen Shousong, a researcher at Analysys International, said the new shareholder structure will allow the group's subsidiaries to better develop their business in the future.
Eight global lenders, including Credit Suisse, DBS Bank, Barclays Bank and China Development Bank, provided the financing for the deal.
Alibaba said it used US$6.3 billion in cash and US$800 million of preferred shares of the group to finance the deal. The remaining US$500 million is being paid to Yahoo under technology and patent licensing agreement.
"The completion of the share buyback will give the company a healthier share structure and also means Alibaba has entered a new development stage," said Jack Ma, Alibaba's chairman and CEO.
The deal values Alibaba at about US$40 billion, bigger than that of US-listed Baidu and Sina.
The move is seen as a further step by the group to take control of its stake structure after it completed the privatization of its Hong Kong-listed B2B unit Alibaba.com in June.
The deal will cut Yahoo's stake in the group to 23 percent from 40 percent previously.
External shareholders, including Softbank Corp and Yahoo, will have less than 50 percent of voting rights, handing more control over the company's future strategy to Alibaba management.
Feng Po, analyst of ChinaVenture Group, said: "The success of the buyback will help speed up Alibaba's strategy shift and also signals a key development in the group's overall listing."
Chen Shousong, a researcher at Analysys International, said the new shareholder structure will allow the group's subsidiaries to better develop their business in the future.
Eight global lenders, including Credit Suisse, DBS Bank, Barclays Bank and China Development Bank, provided the financing for the deal.
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