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Yahoo weighs sale of core business, will not spin off Alibaba stake
[SAN FRANCISCO] Yahoo Inc is weighing a sale of its core business and will not sell of its stake in Alibaba Group Holding Ltd, CNBC reported, a sharp reversal that came after pressure from an activist investor.
Yahoo's shares were up nearly 2 per cent in after hours trading. Alibaba's shares rose 1.3 per cent.
Yahoo's core business consists of its popular Mail service and news sites as well as products like Tumblr and its advertising technology.
The CNBC report, which cited sources, did not disclose a possible price but said an announcement is expected on Wednesday. Analysts and bankers have estimated the unit could fetch between US$2 billion and US$8 billion, with many seeing US$4 billion as the likely price.
Private equity, media and Internet firms are potential buyers, they said.
The latest news came after a three-day meeting of its board of directors last week. Yahoo faced pressure from activist investor Starboard Value LP to sell the core business rather than proceed with the planned spin-off of its US$30 billion stake in Alibaba.
Yahoo could not immediately be reached for comment.