News & Resources

Yahoo Announces Plans to Spin Off its Alibaba Stake in Tax-Free Manner in Response to Starboard

January 27, 2015

The Wall Street Journal, The New York Times and CNBC, among other national publications, reported that Yahoo, Inc. has decided to spin off its $40 billion stake in the Chinese e-commerce company Alibaba Group Holding Ltd. in a tax-free manner through a newly formed independent registered investment company. According to Yahoo, the stock of the investment company will be distributed pro-rata to Yahoo shareholders and the transaction is expected to close in the fourth quarter of 2015.  Olshan client Starboard Value LP has been urging Yahoo to find a tax-efficient way to monetize its investment in Alibaba, to spin off its holdings in both Alibaba and Yahoo Japan together into a separate entity from the main company and to explore a potential tie-up with AOL Inc. Olshan Partners Steve Wolosky and Andrew Freedman represent Starboard in its campaign at Yahoo.