Wednesday, May 11, 2011

Yahoo Sinks On Alibaba Restructuring

Shares of Yahoo! Inc. (NASDAQ: YHOO) slumped more than 7% Wednesday after the company disclosed that Alibaba Group has transferred ownership of its online payments business to a firm controlled by Jack Ma, Alibaba’s chief executive. Yahoo disclosed in a Securities and Exchange Commission filing that it’s “engaged in ongoing discussions regarding the terms of the restructuring and the appropriate commercial arrangements related to the online payment business.“ Yahoo’s owned a 43% stake in Alibaba as of March 31, according to the SEC filing. “To expedite obtaining an essential regulatory license, the ownership of Alibaba Group’s online payment business, Alipay, was restructured so that 100 percent of its outstanding shares are held by a Chinese domestic company which is majority owned by Alibaba Group’s chief executive officer,” the company said. 

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