Yahoo could become takeover target without stake in Alibaba

New York

YAHOO! Inc will be a fraction of its size should the company spin off its remaining stake in Alibaba Group Holding, making it a takeover candidate for SoftBank Corp or private-equity firms.

Marissa Mayer, chief executive of the US$46 billion company, is expected to give an update next week about whether Yahoo will sell its Alibaba shares and how it will avoid paying taxes on the move. With the Chinese e-commerce company accounting for most of Yahoo's value, shareholders would be left holding a US Internet advertising and search business worth about US$5 billion to US$8 billion, according to analysts' estimates compiled by Bloomberg. Yahoo will also still have a roughly US$8 billion stake in Yahoo Japan Corp.