Sunnyvale, California — Just recently Yahoo! CEO Carol Bartz emphasized that “Alibaba is a nice investment for the future,” the internet pioneer in Silicon Valley has sold its entire stake in the Chinese-based business-to-business trading site Alibaba.com for about $150 million, the company said on Monday. Reuters first reported on the story.
Yahoo Inc. unloaded its entire 1.14% stake in the Hong Kong and U.S. listed Alibaba.com after market close on Monday at 19.80-20.30 Hong Kong dollars ($2.54-2.60) a share, about 4-6.4% discount to the stock’s closing price of 21.15 Hong Kong dollars ($2.71), Reuters reported Tuesday, citing a term sheet obtained from brokers.
Yahoo, in November 2007, invested around $100 million in Alibaba.com when it went public on the Hong Kong Exchange. Writing in an e-mail, a company representative said that Yahoo’s “sale of its shares in Alibaba.com is expected to generate pre-tax proceeds of approximately $150 million.”
Although Yahoo has sold its entire direct stake in Alibaba.com, it still indirectly controls ownership in the company. The transaction helped Yahoo! cash in about $150 million from its strategic investment in Alibaba.com since the company’s debut two years ago.
Yahoo’s after-sale clarification on Monday echoed what its new CEO Carol Bartz said in a TV interview broadcast last Thursday on CNBC.
When asked whether Yahoo! would divest its Alibaba shares, Bartz, one of the world’s most influential women according to Forbes, responded that Alibaba was a very good long-term investment for Yahoo! She said that China is a tough market for her firm because the Chinese government is much more interested in media run by Chinese companies, and thus Alibaba is a platform for Yahoo! to expand into the Chinese internet market.
“We are pleased to learn of the Yahoo decision,” Alibaba spokesman John Spelich said in an e-mail today. The sale will help the company achieve broader ownership of its stock, he said.
Jeremy Seow, a Singapore-based spokesman at Yahoo, said he couldn’t immediately comment on the sale.