×
You will be redirected back to your article in seconds

Yahoo Confirms Plan For Reverse Spinoff Separating Core Business, Alibaba Stake

Yahoo has formally abandoned plans to spin off its $31 billion stake in Chinese Internet giant Alibaba. The troubled Internet company will instead do a reverse spinoff of its other assets, putting those businesses into a separate publicly traded company.

Shares in Yahoo rose 1.55% to $35.39 in pre-market trading. In a statement announcing the decision, Yahoo chairman Maynard Webb said the company was dissuaded from spinning off its position in Alibaba because of tax concerns from investors.

“We believe that the previously announced spin off would be tax free to Yahoo and its shareholders,” said Webb in a statement. “However, in consideration of developments since the original spin off plan was announced and after significant deliberations, we are suspending work on the Aabaco spin off. Among other factors, we were concerned about the market’s perception of tax risk, which would have impaired the value of Aabaco stock until resolved.”

News of the spin-off will likely lead to speculation about potential suitors for Yahoo’s other media and technology assets. Barry’s Diller’s IAC is expected to be among the interested parties. On Wednesday, the company said it will create a new IAC Publishing unit that will consist of properties such as Daily Beast and About.com.

There remain several regulatory hurdles to the reverse spin off and Yahoo said that the deal could take a year or more to wrap up.

Expectations were high when Yahoo tapped Google executive Marissa Mayer in 2012 to lead its turnaround. She’s struggled to right the ship, however, and a push to invest more in original television series, typified by the company’s rescue of the canceled NBC sitcom “Community,” resulted in tens of millions of dollars in losses. At the same time, Yahoo’s search business has been surpassed by Google and investor excitement has migrated to tech rivals such as Facebook.

More Biz

  • Hong Kong Disneyland Remains in the

    Hong Kong Disneyland Remains in the Red but Reduces Losses

    The Hong Kong Disneyland Resort theme park remained in the red for the fourth straight year, but there are signs of improvement. For the financial year to end-September 2018, HKDL reported $769 million (HK$6 billion) of revenue from 6.7 million visitors, an increase of 8%. Net losses fell from $32 million (HK$291 million) to $6.92 [...]

  • Lisa Borders Time's Up

    Time's Up President Lisa Borders Resigns

    Lisa Borders has resigned as president of Time’s Up, she and the organization announced on Monday. Borders is resigning due to family issues, she said in a statement. Time’s Up COO Rebecca Goldman will now serve as interim CEO. “As Time’s Up continues to grow, I am proud of the work I have done to [...]

  • Jussie Smollett Good Morning America

    Jussie Smollett Angrily Denies Complicity in Attack

    Attorneys for “Empire” actor Jussie Smollett issued a statement Saturday denying that he orchestrated his Jan. 29 assault, and saying he is “angered” and “devastated” by recent developments in the case. Chicago police want to interview Smollett, after learning new evidence from two Nigerian brothers who were released on Friday night. Local media outlets have [...]

  • Walt Disney Archives Founder Dave Smith

    Walt Disney Archives Founder Dave Smith Dies at 78

    Walt Disney Archives founder Dave Smith, the historian who spent 40 years cataloging and preserving the company’s legacy of entertainment and innovation, died Friday in Burbank, Calif. He was 78. Smith served as Disney’s chief archivist from 1970 to 2010. He was named a Disney Legend in 2007 and served as a consultant to the [...]

  • Colin Kaepernick Kneel

    Colin Kaepernick, Eric Reid Reach Settlement With NFL

    Colin Kaepernick and Eric Reid, two football players who alleged the National Football League colluded to oust them from the game after they started kneeling in protest of racial inequality during the playing of the national anthem, have reached a settlement in the matter, according to a statement from the sports organization and lawyers representing [...]

  • R. Kelly

    R. Kelly Could Be in ‘Big Trouble’ Over Alleged New Sex Tape, Attorney Says

    Strong allegations of sexual misconduct have followed R. Kelly for 25 years, but the singer has always managed to slip free. Yet reports that a videotape of him sexually assaulting an underage girl, combined with the outcry surrounding the Lifetime documentary “Surviving R. Kelly,” means that public sentiment, at the very least, is definitely not [...]

  • Christian Bale as Dick Cheney in

    New Media Residuals and Feature Films Contribute to Spike in Writers' Pay

    The outlook for members of the Writers Guild of America has brightened — even amid pervasive uncertainty in the entertainment industry. According to the most recent report to WGA West members, earnings surged 2.8% to $1.41 billion in 2017, thanks mostly to gains in feature films and new-media residuals. Total covered earnings for WGA West [...]

More From Our Brands

Access exclusive content