R.I.P. Altaba: Yahoo Spinout Announces Complete Liquidation

Altaba’s journey has come to its natural end – the Yahoo spinout that emerged after Yahoo sold most of its business to Verizon will sell up to 50 percent of the Alibaba shares it holds. The sale of the other 50 percent of shares is pursuant to approval from stockholders.

In an official press release, Altaba’s team announced that plans for the company’s complete liquidation and dissolution have been approved.

The sale of Alibaba shares is anticipated to produce nearly 40 billion dollars for shareholders. Following the completion of the process, Altaba’s association with Alibaba will end.

Altaba holds ordinary shares and American Depository Shares (ADS) in Alibaba. A quick NASDAQ ownership summary shows that over the past three months, the company did not rank among the top five institutional investors.

Alibaba has responded to the news relatively fast in a more or less neutral manner.

“Stocks are for trading. Any shareholder has the right to deal stock anytime on the market, for any purpose. We’re happy to have had Yahoo invest in Alibaba in the past and to see it now collecting a strong return on its investment,” an official Alibaba announcement pertaining to the latest events reads.

Altaba was set up in 2017, following the AOL acquisition of Yahoo. The aim of the company was to keep hold of the 15 percent stake Yahoo had in Alibaba. In addition, Altaba held a 35.5 percent stake in Yahoo Japan.

The relationship between Yahoo and Alibaba, however, goes way back.

In 2005, Yahoo invested nearly one billion US dollars in 30 percent of the ecommerce giant. The company sold half of its stake in Alibaba in 2012 through a deal that had shares set at 13 dollars. Only two years later, Alibaba went public. Its US IPO was record-breaking. The company went public on September 18, 2014 at the impressive 21.8 billion dollars. Four days later, an option to sell more shares was exercised and the grand total went up to 25 billion dollars.

This sum broke all records, making Alibaba’s IPO the largest one ever.

Today, Alibaba shares are worth approximately 180 dollars – a massive appreciation from the 13 dollars that Yahoo decided to sell at seven years ago.