This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Yahoo!'s Alibaba Treasure Will Have to Wait

NEW YORK ( TheStreet) -- Yahoo!'s (YHOO) crown jewel has always been its stake in Alibaba, as the Chinese Internet giant has continued to soar in value. With a valuation approaching $100 billion, the time for Alibaba to realize the benefits of its empire is getting closer. It's just not imminent, however.

The China Perspective reported Alibaba Group has applied for a listing in the Hong Kong stock exchange, but the company said that was not true.

"No truth to the reports," Alibaba spokesman John Spelich said in an email. "We have no timetable. We have not hired banks. And we have not selected a location."

In September 2012, Yahoo! sold about half of its original 40% stake in Alibaba. The sale netted $7.6 billion before taxes; $3 billion from that sale, or 85% of its net cash proceeds, was returned to shareholders in a stock buyback. As part of that deal, Yahoo! agreed to sell half of its remaining 24% stake in the event of an Alibaba IPO.

Yahoo! acquired the stake in 2005 for $1 billion in a deal spearheaded by Jerry Yang, Yahoo!'s co-founder.

According to Yahoo's recent earnings report, Alibaba has continued to perform exceptionally well. The Chinese-based Alibaba provided Yahoo! with net income of $669 million in the quarter, up 203% year-over-year, as revenue rose 71% during the same timeframe. That strong performance helped Yahoo! shares rise 8% on July 17, the day following Yahoo!'s earnings, to a five-year high.

Since Yahoo! hired new CEO Marissa Mayer in July 2012, Yahoo's stock has climbed more than 85%. This growth has been driven mainly by stock buybacks financed by the initial 2012 sale of Yahoo's Alibaba stake.

Yahoo!'s shares were falling 1.54% to $27.43 in early Tuesday trading.

-- Written by Chris Ciaccia and Laura Berman in New York

>Contact by Email.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,279.74 +13.75 0.08%
S&P 500 2,010.40 -0.96 -0.05%
NASDAQ 4,579.7870 -13.6380 -0.30%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs