On Wednesday 22 June, Yahoo Inc, Japan’s Softbank Corp and China’s Alibaba Group said that a “substantive and encouraging progress” has been made by them towards the agreement regarding ownership of the Chinese Company Alibaba Group’s Alipay e-payment unit. The three business firms are currently engaged in a high profile hassle over the transferral of Alipay to Alibaba founder Jack Ma owned company.
Currently Yahoo owns 40 percent of Alibaba while Softbank owns 30 percent of it. Alibaba said that it was necessary to transfer Alipay in order to abide by the Chinese regulations. These regulations put restrictions on foreign ownership in –payment companies.
Last month Yahoo had reached an early agreement with Alibaba regarding Alipay but an affirmative reply from Masayoghi Sen who is the Softbank CEO and also a board member of Alibaba is needed to finalize the deal. Son said a few days back in this week that they are expecting that soon an agreement would be reached between Alibaba and the Japanese mobile carrier. In a joint statement on 22 June the companies remarked the objectives as reaching an agreement that “in a timely manner” functions according to all the stakeholder’s interests. They refused to comment on any further details till the time was right to do so.
The relation between Yahoo and Alibaba has been pretty rough so far. Yahoo is quite offended at being sidelined when major decisions were taken. Yahoo has out rightly rejected Ma’s company’s attempts to buy back a certain portion of the invested stake of the U.S. Company. A few investors are of the viewpoint that Yahoo’s major assets in Asia could be worth of entire current market value of Yahoo.
Alibaba.com, a unit of Alibaba Group saw its shares spike up more than 7 percent on Wednesday. Analysts believe this could be because of the overnight rebound in U.S. listed Chinese technology stocks. Jackson Wong, vice president at Tanrich Securities in Hong Kong said that Investors are broadly on bargain hunt, but the overnight gains in Chinese tech stocks on NASDAQ have also resulted in tech gains as a carry over.
Tuesday saw U.S. listed Baidu rise 8 percent and Sina Corp jumping 18.6 percent. On Friday Alibaba.com shares toppled by 5.4 percent after Alibaba revealed that Taobao had been reorganized. Taobao is the largest e-commerce website of China. It has been reorganized into three different companies thus crushing any opportunity of a Taobao public offering.