BIG WINDFALL FOR YAHOO# Stock
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Yahoo to Reap More Than $8 Billion in Alibaba’s U.S. IPO
By Brian Womack Sep 5, 2014 11:01 PM CT
Sept. 5 (Bloomberg) –- Oberweiss Asset Management’s Jeffrey Papp, Warburg
Pincus' Bill Janeway, Bloomberg Intelligence’s Praveen Menon, Bloomberg’s
Leslie Picker and Julie Hyman discuss the proposed price range for Alibaba
shares. They speak on “Street Smart.” (Source: Bloomberg)
After pouring about $1 billion nine years ago into Alibaba Group Holding Ltd
., Yahoo! Inc. (YHOO) is set to reap a massive haul as the Chinese e-
commerce company goes public: more than $8 billion.
Alibaba said yesterday in a regulatory filing that it and shareholders like
Yahoo plan to sell 320.1 million American depositary shares for $60 to $66
apiece in the Chinese company’s U.S. initial public offering. Yahoo,
specifically, will sell 121.7 million of its Alibaba shares, reaping as much
as $8.03 billion. Yahoo would still retain a 16.3 percent stake in the
Hangzhou, China-based company following its public market debut, according
to the filing.
The payout would punctuate Yahoo’s long investment after Alibaba pushed up
the value of the Sunnyvale, California-based Web portal over the years. A
new war chest of cash would enable Yahoo to do more buybacks and potentially
more acquisitions. Yahoo has long leaned on its Alibaba stake to give it
breathing space as Chief Executive Officer Marissa Mayer tries to turn
around the company, which is dealing with competition from Google Inc. and
Facebook Inc. in online ads and for user attention.
The windfall follows Yahoo’s earlier sale of some Alibaba shares. In 2012,
the company unloaded 523 million ordinary shares for about $7.1 billion.
Photographer: Simon Dawson/Bloomberg
Yahoo! Inc. has long leaned on its Alibaba stake to give it breathing space
as Chief... Read More
The new proceeds would also triple Yahoo’s cash hoard, which stood at $4.3
billion as of the end of June, according to data compiled by Bloomberg.
Sarah Meron, a spokeswoman for Yahoo, declined to comment.
Shareholder Proceeds
For Alibaba’s IPO, Yahoo had earlier planned to sell 208 million shares,
yet had cut that down to around 140 million shares in July, Ken Goldman,
Yahoo’s chief financial officer, said in a statement that month.
“We are committed to return at least half of the after-tax IPO proceeds to
shareholders, in line with our overarching commitment to maximizing
shareholder value through prudent capital allocation,” Goldman said in the
statement. Yahoo’s initial sale of Alibaba shares will be fully taxed, and
the company will seek ways to reduce how much it must pay in the future,
Goldman said at the time.
That still leaves Yahoo plenty of other cash. Mayer has said she will be
thoughtful with how she uses the company’s money.
“We intend to be good stewards of the capital; we have been good stewards
of the capital to date,” Mayer said in May. “We know this is of critical
importance to our investors -- how any proceeds are handled.”
Mayer has stepped up the pace of acquisitions at Yahoo since she joined in
2012. The company said yesterday it had acquired Luminate Inc., an online
advertising startup. Terms of the deal weren’t disclosed.
``Luminate combines text analysis, computer vision, machine learning and
crowdsourced human analysis to deliver the most relevant and appropriate ads
to users,'' Yahoo said.
By Brian Womack Sep 5, 2014 11:01 PM CT
Sept. 5 (Bloomberg) –- Oberweiss Asset Management’s Jeffrey Papp, Warburg
Pincus' Bill Janeway, Bloomberg Intelligence’s Praveen Menon, Bloomberg’s
Leslie Picker and Julie Hyman discuss the proposed price range for Alibaba
shares. They speak on “Street Smart.” (Source: Bloomberg)
After pouring about $1 billion nine years ago into Alibaba Group Holding Ltd
., Yahoo! Inc. (YHOO) is set to reap a massive haul as the Chinese e-
commerce company goes public: more than $8 billion.
Alibaba said yesterday in a regulatory filing that it and shareholders like
Yahoo plan to sell 320.1 million American depositary shares for $60 to $66
apiece in the Chinese company’s U.S. initial public offering. Yahoo,
specifically, will sell 121.7 million of its Alibaba shares, reaping as much
as $8.03 billion. Yahoo would still retain a 16.3 percent stake in the
Hangzhou, China-based company following its public market debut, according
to the filing.
The payout would punctuate Yahoo’s long investment after Alibaba pushed up
the value of the Sunnyvale, California-based Web portal over the years. A
new war chest of cash would enable Yahoo to do more buybacks and potentially
more acquisitions. Yahoo has long leaned on its Alibaba stake to give it
breathing space as Chief Executive Officer Marissa Mayer tries to turn
around the company, which is dealing with competition from Google Inc. and
Facebook Inc. in online ads and for user attention.
The windfall follows Yahoo’s earlier sale of some Alibaba shares. In 2012,
the company unloaded 523 million ordinary shares for about $7.1 billion.
Photographer: Simon Dawson/Bloomberg
Yahoo! Inc. has long leaned on its Alibaba stake to give it breathing space
as Chief... Read More
The new proceeds would also triple Yahoo’s cash hoard, which stood at $4.3
billion as of the end of June, according to data compiled by Bloomberg.
Sarah Meron, a spokeswoman for Yahoo, declined to comment.
Shareholder Proceeds
For Alibaba’s IPO, Yahoo had earlier planned to sell 208 million shares,
yet had cut that down to around 140 million shares in July, Ken Goldman,
Yahoo’s chief financial officer, said in a statement that month.
“We are committed to return at least half of the after-tax IPO proceeds to
shareholders, in line with our overarching commitment to maximizing
shareholder value through prudent capital allocation,” Goldman said in the
statement. Yahoo’s initial sale of Alibaba shares will be fully taxed, and
the company will seek ways to reduce how much it must pay in the future,
Goldman said at the time.
That still leaves Yahoo plenty of other cash. Mayer has said she will be
thoughtful with how she uses the company’s money.
“We intend to be good stewards of the capital; we have been good stewards
of the capital to date,” Mayer said in May. “We know this is of critical
importance to our investors -- how any proceeds are handled.”
Mayer has stepped up the pace of acquisitions at Yahoo since she joined in
2012. The company said yesterday it had acquired Luminate Inc., an online
advertising startup. Terms of the deal weren’t disclosed.
``Luminate combines text analysis, computer vision, machine learning and
crowdsourced human analysis to deliver the most relevant and appropriate ads
to users,'' Yahoo said.