Yahoo appears to be at a crossroads. The company may spin-off its core business as it faces intense competition and pressure to boost shareholder value. It’s also reportedly weighing whether it should continue with its plan to sell its most valuable asset, its stake in Alibaba.
CCTV’s Karina Huber reports.
Yahoo may spin off $3 billion core business, considering selling Alibaba stakeYahoo appears to be at a crossroads. The company may spin off its core business as it faces intense competition and pressure to boost shareholder value. It's also reportedly weighing whether it should continue with its plan to sell its most valuable asset, it's stake in Alibaba. CCTV's Karina Huber reports.
Yahoo’s board recently ended a three-day meeting that reportedly included discussions to sell its portfolio of online businesses. That core business is estimated to be worth around $3 billion. That’s less than 10 percent of its overall value. Most of Yahoo’s real worth is in its Alibaba stake, which it planned to sell in January.
The discussions come at a time when Yahoo has been struggling to compete against Facebook and Google in attracting online advertisement dollars.
The pressure to sell its core business is coming in large part from activist hedge fund Starboard Value that owns a substantial stake in Yahoo. In a reversal of opinion, it now wants the company to stick with its Alibaba investment and scrap the rest.
Starboard’s new position comes after the Internal Revenue Service failed to reassure shareholders there wouldn’t be a big tax bill if the Alibaba stake were spun off.
At this point it is unclear what Yahoo is going to do. But even if it does sell its core business, experts say the name Yahoo will likely survive.
Author Ray Wang discusses whether Marissa Mayer still has support at Yahoo
CCTV America’s Mark Niu interviewed Constellation Research tech analyst R “Ray” Wang and asked him about Mayer’s future at Yahoo. Wang is also the author of “Disrupting Digital Business”.