Yahoo Inc said on Wednesday it had shelved plans to spin off its stake in Chinese e-commerce giant Alibaba Group Holding Ltd, citing tax concerns, and will instead create a separate company to hold the rest of its assets.
The new publicly traded company will house Yahoo’s Internet business and its 35 percent stake in Yahoo Japan, giving investors a clearer view of the company’s core business.
However, the plan – which may take a year or more to conclude – adds another layer of uncertainty to Chief Executive Marissa Mayer’s efforts to revive the struggling company.
Yahoo had intended to spin off its Alibaba stake, worth more than $30 billion, by January.
Yahoo, which has a market capitalization of about $35 billion, owes almost all of its valuation to its 15 percent stake in Alibaba and its holding in Yahoo Japan.
The company has struggled to grow its Internet business, which includes selling search and display ads on its news and sports sites and email service, in the face of competition from Alphabet Inc’s Google and Facebook Inc. Read more