Yahoo’s board of directors finished its first of three days of meetings on Wednesday without reaching a decision on whether to press ahead with the planned spinoff of its stake in Chinese ecommerce company Alibaba, according to CNBC’s David Faber.
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Yahoo Japan would consider any options for buying back its shares, said spokesman Masaki Hanyu. Activist shareholder Starboard called on Yahoo last month to put a stop to its plan to spin off the Alibaba stake, which is otherwise expected to happen next month. She has promised to provide further details next month.
In addition to its search platform, Yahoo Internet businesses include Yahoo News, Yahoo Mail and social media site Tumblr, among other holdings. The news comes as Yahoo’s board and chief executive Marissa Mayer faces growing pressure over the company’s performance.
Yahoo has seen revenues continue to decline, despite turnaround efforts since Ms Mayer took the top job three-and-a-half years ago. The troubled engine giant has struggled in recent years to compete with the rise of Google and Facebook, and debate now rages as to whether turning its decline around is even possible.
NY hedge fund Starboard Value is seeking to gain board support for a plan to sell Yahoo’s websites, mobile applications, ad services and data analytics.
The company was planning the spinoff worth $30 billion to be completed this year and this had been announced by Mayer while releasing the 3Q15 results in October 2015. Mayer has also lost some important executives who were part of the Alibaba share sale deal including chief development officer Jacqueline Reses, media strategist Rob Barrett and chief marketing officer Kathy Savitt, this year.
After earlier urging the company to spin off the Alibaba stake, Starboard reversed course.
Yahoo said that it will still proceed with the initial plan despite IRS’ refusal of its request. (NASDAQ:YHOO) seeks a buyer for its underperforming core Internet business. Brian Wieser from Pivotal Research Group said that the core business of the company was declining. Furthermore, the WSJ explained that if Yahoo goes ahead with this spin-off, a purchase of the spun-off organization would discourage Alibaba due to the high-tax risk.
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Should Yahoo decide to sell its core business, private equity firms are expected to gobble up the wide variety of web assets the company owns.
