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Yahoo late Tuesday said it has sold the first part of its stake in Chinese online company Alibaba Group.
Alibaba completed an initial buyback of nearly half of Yahoo’s 40 percent stake in a move that raised about $4.3 billion for the company led by new CEO Marissa Mayer.
Yahoo says it retains about a 23 percent stake following the sale.
The Internet giant will use the cash to return money to shareholders to the tune of about $3.65 billion and add to its cash reserves.
Analysts recently wondered if Yahoo could use a bigger portion of the cash for acquisitions or other deals after Mayer had said she would review how to put the money to work.
Yahoo had acquired its Alibaba stake in 2005 for $1 billion as a bet on the fast-growing Chinese market.
In recent years though, Yahoo critics had pushed for a sale of the stake to give investors an incentive to buy or hold a sagging stock price. The companies reached a deal in May that valued Alibaba at about $40 billion.
Email: Georg.Szalai@thr.com
Twitter: @georgszalai
