Alibaba seeks Yahoo CEO after talks: insider
Updated: 2012-02-16 10:42
HONG KONG / SAN FRANCISCO - Alibaba Group Holding Ltd and Japan's Softbank Corp will go directly to Yahoo Inc's chief executive, bypassing negotiators from the US Internet company. That's after talks over the sale of Yahoo's Asian holdings broke down, a person familiar with the negotiations said on Wednesday.
The struggling Internet company has been in discussions to sell its stakes in the Chinese e-commerce company Alibaba Group and Yahoo Japan back to Alibaba and Yahoo Japan shareholder Softbank.
But the person, who declined to be identified because the talks are confidential, said that Softbank and Alibaba will go directly to Yahoo CEO Scott Thompson for more clarity after talks broke down over the terms on Tuesday. The person said Yahoo's negotiating team seemed to have different ideas from the company's leaders.
"Softbank and Alibaba will be reaching out to Scott Thompson to get clarity on what the heck is going on," the person said.
The fate of Yahoo's Asian holdings remains in limbo after negotiations over the stakes abruptly broke off. It's the latest twist in the drama that has been swirling around Yahoo since it fired Carol Bartz as CEO five months ago.
The person said the talks broke down over unreasonable terms but wouldn't specify what that meant, except to say that it wasn't over price.
"The strategic leaders were saying 'We want to unlock some value here so we can free up some cash and focus on the core," said the person. "Based on the behavior of the most recent negotiation session (in Hong Kong), it was clear that somebody else had a different idea."
On Tuesday, two other people familiar with the talks said they stalled over the price.
Analysts have differed on how much Yahoo could fetch from selling its stakes, with estimates ranging from $11 billion to $18 billion.
The failure to reach an agreement may put further strain on Yahoo's board, which announced plans this month to replace some directors while it continues a review of the company's strategic options. Shareholder Third Point LLC plans to nominate its own slate of directors to the board, saying the recent overhaul didn't go far enough to soothe concerns about Yahoo's prospects.
"The recently announced changes do not put the issuer on the right track toward maximizing shareholder value," Third Point, a New York-based hedge fund run by Daniel Loeb, said in a filing on Tuesday. "Installing the hand-picked choices of the current board does nothing to allay investor fears that Yahoo is poised to repeat the errors of its past."
After years of sluggish sales, a stagnant stock price and market-share losses to Facebook Inc and Google Inc, Yahoo investors see the Asian sale as a way to earn a payday. Yahoo also spurned a $47.5 billion takeover bid from Microsoft Corp in 2008, irking shareholders. The value of the Asian assets is about $11.5 billion, according to Sameet Sinha, an analyst at B. Riley & Co in San Francisco.
Yahoo's stock fell 4.7 percent to $15.37 on Tuesday in New York. The shares have lost 9 percent of their value in the past year. Yahoo Japan, meanwhile, fell as much as 5.5 percent in Tokyo on Wednesday. Shares of Alibaba remained suspended in Hong Kong, as they have been since Feb 9. There is no publicly traded debt on the company, according to data compiled by Bloomberg.
Bloomberg News - AP
Alibaba attracts fund investment 2011-09-24 07:51
Alibaba execs resign over supplier frauds 2011-02-22 07:53
Alibaba Group to launch mobile OS in Q3: Report 2011-07-05 14:31
Alibaba gives 60m yuan for quake help 2011-05-16 15:06
- Foreign trade outlook remains challenging
- Accenture opens lab for R&D
- Culture to be pillar industry
- Third-party auto insurance open to foreign firms
- Wen vows to speed up fiscal, financial reforms
- Alibaba seeks Yahoo CEO after talks: insider
- Experts: EU statement opens door to status
- China's FDI falls 0.3% in Jan