Yahoo shares fell due to the failure of the transaction to allocate its stake in Alibaba worth $ 23 billion
A big deal on the allocation of Alibaba’s Yahoo- owned assets was in jeopardy. The share of Yahoo in Alibaba is 15%. The value of the share is estimated at $ 23 billion. Alibaba’s plans for budding assets became known in January. Yahoo shareholders insisted on this. They also set a condition that the proceeds would not be spent on further mergers and acquisitions, but instead go to investors.
The administration of US President Barack Obama monitors transactions in which foreigners buy US companies, reducing their tax base in the United States.
Usually, when separating a part of a business into an independent company, the firms request approval from the tax administration or from an external legal council. Earlier this year, Yahoo requested approval from the United States Revenue Service to allocate its stake in Alibaba. New company Aabaco was planned to be formed by the end of the year on the basis of a small division of Yahoo Small Business. The division provides web design services, hosting corporate sites and others.
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Without such a unit, a new company could be regarded only as an investment tool. In this case, Yahoo will not be able to avoid taxation. According to US laws, asset budding is not taxable only if the new company has a real business, has a staff and earns income. The cost of the proposed transaction in recent months has already greatly decreased. Alibaba shares since the beginning of the year fell by 41%. Yahoo quotes for the same period lost 39% in price.
As noted by Yahoo, the tax administration has not come to an unequivocal decision that the transaction should be taxed. The transaction request has been withdrawn, reports Bloomberg. The transaction with these assets in the previously conceived form is unlikely, so now Yahoo will consider the possibility of budding its key business or selling it to a strategic buyer, said Mark May, an analyst at Citigroup.
On Tuesday, September 8, Alibaba shares in New York fell 4.7% to $ 60.91. As a result, its capitalization decreased by $ 140.7 billion and amounted to $ 153 billion. On August 24, the price per share of the retailer for the first time fell below the price of the IPO times and amounted to $ 68. However, the company's executive director, Daniel Zhang, called on its employees to focus on long-term prospects, Megamind wrote .
Despite the decline in the Chinese stock market for three months, Tencent's capitalization on the Hong Kong Stock Exchange has grown by 19% since the beginning of the year, to $ 162 billion. On Wednesday, its shares rose another 3%.
Tencent owns WeChat and QQ , the most popular messaging services in China, with a billion users. According to analyst Jeff Hao from Hong Kong’s China Merchants Securities Holdings, Tencent has very good prospects for monetizing mobile services through advertising.
Alibaba was vulnerable due to the slowdown in the growth of the Chinese economy, as it receives 83% of its revenue from the domestic market, Bloomberg said.
The administration of US President Barack Obama monitors transactions in which foreigners buy US companies, reducing their tax base in the United States.
Usually, when separating a part of a business into an independent company, the firms request approval from the tax administration or from an external legal council. Earlier this year, Yahoo requested approval from the United States Revenue Service to allocate its stake in Alibaba. New company Aabaco was planned to be formed by the end of the year on the basis of a small division of Yahoo Small Business. The division provides web design services, hosting corporate sites and others.
')
Without such a unit, a new company could be regarded only as an investment tool. In this case, Yahoo will not be able to avoid taxation. According to US laws, asset budding is not taxable only if the new company has a real business, has a staff and earns income. The cost of the proposed transaction in recent months has already greatly decreased. Alibaba shares since the beginning of the year fell by 41%. Yahoo quotes for the same period lost 39% in price.
As noted by Yahoo, the tax administration has not come to an unequivocal decision that the transaction should be taxed. The transaction request has been withdrawn, reports Bloomberg. The transaction with these assets in the previously conceived form is unlikely, so now Yahoo will consider the possibility of budding its key business or selling it to a strategic buyer, said Mark May, an analyst at Citigroup.
On Tuesday, September 8, Alibaba shares in New York fell 4.7% to $ 60.91. As a result, its capitalization decreased by $ 140.7 billion and amounted to $ 153 billion. On August 24, the price per share of the retailer for the first time fell below the price of the IPO times and amounted to $ 68. However, the company's executive director, Daniel Zhang, called on its employees to focus on long-term prospects, Megamind wrote .
Despite the decline in the Chinese stock market for three months, Tencent's capitalization on the Hong Kong Stock Exchange has grown by 19% since the beginning of the year, to $ 162 billion. On Wednesday, its shares rose another 3%.
Tencent owns WeChat and QQ , the most popular messaging services in China, with a billion users. According to analyst Jeff Hao from Hong Kong’s China Merchants Securities Holdings, Tencent has very good prospects for monetizing mobile services through advertising.
Alibaba was vulnerable due to the slowdown in the growth of the Chinese economy, as it receives 83% of its revenue from the domestic market, Bloomberg said.
Source: https://habr.com/ru/post/294394/
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