Yahoo-Alibaba
“Yahoo! is investing $1 billion in cash to purchase Alibaba.com shares from the company and other shareholders. The agreement gives Yahoo! an approximately 40 percent economic interest with 35 percent voting rights, making it the largest strategic investor in Alibaba.com. ” … “The overall transaction is valued at more than $4 billion.” …. “The combined entity will have a four-person board. Management of Alibaba.com will hold two seats, with CEO Jack Ma serving as the board’s chairman. Other directors will include Jerry Yang, Yahoo’s co-founder and Chief Yahoo!, and a representative from Softbank. ”
Press release, Reuters (via MSN)
Summary from China Net Investor
Yahoo’s online assets in China:
Yahoo China: Yahoo China’s main site; Portal
Yisou.com: Search engine
3721.com: Search technology provider
Share of China’s search market (all three combined): 22.7 percent
Source: Shanghai iResearchAlibaba’s operations:
Alibaba.com: Business-to-business e-commerce site; handled $4.5B in transactions in 2004
Taobao.com: Online auction site; eBay’s main competitor in China
Alipay: Online payment system; more than 2 million users; competes against eBay’s PayPal
more and roundup of comments at PaidContent
Tags: china, business, investing, yahoo, ecommerce, ebayThis deal is potentially disastrous for Ebay in China. Taobao was eating its lunch on a small budget; now they have the backing of Yahoo to ramp up their efforts several notches. Some people thought if things got really bad for Ebay they could always buy up Alibaba (Ebay is rumored to have offered Alibaba $1B a few months ago). Now that option is gone and there is not another auction player they can buy that would be meaningful. The Alibaba transaction may be the deal that leads Yahoo to ‘Japan-ning” Ebay again, this time in China.
