Yahoo Rallies, Calls Alibaba Return To Shareholders 'Historic'
Yahoo! Inc.'s (NASDAQ: YHOO) spin-off plan for its Alibaba Group Holding Ltd (NYSE: BABA) stake will result in a total of nearly $50 billion returned to shareholders from the investment, the company said Tuesday.
To date Yahoo has completed about $9.7 billion in buybacks related to the investment.
Yahoo on Tuesday resolved long-standing questions about the stake, announcing plans for a tax-free spinoff of its $40 billion in Alibaba holdings into a separately traded company that will be owned by Yahoo shareholders.
The company rallied more than 7 percent on the news, plus a fourth-quarter earnings beat, changing hands recently in the extended session at $51.64.
"This level of capital return is historic, especially for a company of our size," Chief Executive Marissa Mayer said in a statement.
The deal is subject to regulatory and board approval and is expected to close in the fourth quarter.
The composition of the spin-off company's board and management, as well as the distribution ratio, will be announced prior to the closing, Yahoo said.
Image credit: Gaku, Wikimedia
© 2016 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.