Yahoo reviewing strategy, including use of cash from Alibaba deal

The company had earlier said that it would return to shareholders substantially all of the after tax cash proceeds of the deal

Yahoo's new CEO Marissa Mayer is reviewing the company's business strategy, which could lead it to change its plans to return to shareholders after tax cash proceeds from a deal with Alibaba Group, the company said in a regulatory filing on Thursday.

The move suggests that Mayer may be considering other uses for the cash to revive ailing Yahoo, including through acquisitions and investment in new products.

Yahoo said in May it agreed to sell off about half of its stake in Alibaba Group back to the Chinese e-commerce giant as part of a US$7.1 billion deal. Alibaba will buy back about 20 percent of its own stake from Yahoo for at least US$6.3 billion in cash proceeds and up to $800 million in newly-issued Alibaba preferred stock, according to the agreement. The deal is expected to be concluded later this year, Yahoo said.

Mayer intends to review with the board of directors, among other things, the company's growth and acquisition strategy, a restructuring plan it began implementing in the second quarter, and the company's cash position and planned capital allocation strategy, the company said.

Besides addressing the earlier plan to return substantially all of the after tax cash proceeds from the Alibaba deal, the review process may also lead to a re-evaluation or changes to Yahoo's other current plans, including the restructuring plan, and a share repurchase program, Yahoo said.

Yahoo appointed Mayer, a former high-profile Google executive, as CEO last month, leading to speculation that Mayer, who was in charge of Google's Local, Maps and Location products, would boost product development at Yahoo. The company reported revenue and profit in the second quarter that was slightly lower than in the same quarter a year earlier.

John Ribeiro covers outsourcing and general technology breaking news from India for The IDG News Service. Follow John on Twitter at @Johnribeiro. John's e-mail address is john_ribeiro@idg.com

Join the newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

John Ribeiro

IDG News Service
Show Comments

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Ben Ramsden

Sharp PN-40TC1 Huddle Board

Brainstorming, innovation, problem solving, and negotiation have all become much more productive and valuable if people can easily collaborate in real time with minimal friction.

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Ratchada Dunn

Sharp PN-40TC1 Huddle Board

The Huddle Board’s built in program; Sharp Touch Viewing software allows us to easily manipulate and edit our documents (jpegs and PDFs) all at the same time on the dashboard.

George Khoury

Sharp PN-40TC1 Huddle Board

The biggest perks for me would be that it comes with easy to use and comprehensive programs that make the collaboration process a whole lot more intuitive and organic

David Coyle

Brother PocketJet PJ-773 A4 Portable Thermal Printer

I rate the printer as a 5 out of 5 stars as it has been able to fit seamlessly into my busy and mobile lifestyle.

Kurt Hegetschweiler

Brother PocketJet PJ-773 A4 Portable Thermal Printer

It’s perfect for mobile workers. Just take it out — it’s small enough to sit anywhere — turn it on, load a sheet of paper, and start printing.

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?