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title: Yahoo Announces $40 Billion Spin-Off Of Its Alibaba Shares | TIME
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# Yahoo Announces $40 Billion Spin-Off Of Its Alibaba Shares

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<!-- video src="https://cdn.jwplayer.com/manifests/TsczqmZQ.m3u8" -->
## Video: Yahoo Announces $40 Billion Spin-Off Of Its Alibaba Shares

[Watch (HLS stream): Yahoo Announces $40 Billion Spin-Off Of Its Alibaba Shares](https://cdn.jwplayer.com/manifests/TsczqmZQ.m3u8) (1:41)

![Yahoo Announces $40 Billion Spin-Off Of Its Alibaba Shares](https://cdn.jwplayer.com/v2/media/TsczqmZQ/poster.jpg?width=720)

_Published 2015-01-28. On Tuesday, Yahoo CEO and President Marissa Mayer announced the tech company would be spinning off its $40 billion stake in Chinese tech giant Alibaba in order to avoid the $16 billion tax bill that would have came with selling the shares._


---

Jul 27, 2023 5:49 PM UTC

---

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### Verizon to Purchase Yahoo for $4.83 Billion

[Yahoo Will Keep Alibaba Stake, Spin Off Core Business](/video/uO5OH4o9/)

### Yahoo Will Keep Alibaba Stake, Spin Off Core Business

---


## Transcript

Sure, Apple may have hogged some of the spotlight during Tuesday's earnings announcements, but Yahoo! had it's own big news to announce. A $ 40 billion spin off. Today, I'm happy and proud to announce that management has recommended, and the Yahoo! board has authorized a plan to pursue a tax free spin off. Of 100 % of the company's remaining holdings in Alibaba. By spinning its 15 % stake in Alibaba into a new company, Yahoo! can avoid having to foot a $ 16 billion corporate tax bill, and that makes for some very happy shareholders. The new spinoff company is for now applicably called, SpinCo, and will consist of Yahoo!

's 15. 4 % stake in Alibaba, along with something called an ATB, or Active Trade or Business. The nameless ATB is required in order for the spinoff to remain tax free, and as Bloomberg's Matt Levine. Explains the smaller and less important it is, the better it'll be for shareholders. The end goal here would be for Yahoo! to successfully sell off its $ 40 billion Alibaba stake for as much as possible. While Yahoo! still can't sell Spinco without incurring a hefty tax bill, someone else could still buy it for something closer to its full value. And who better to buy the spinoff than Alibaba it's self.

The Chinese giant would be claiming a decent chunk of it's shares and could then do whatever it wants with Spinko. But until Alibaba decides to buy Spinko, if even does, word say Heather Timmons says spinoff put the Asian company in a tight spot. That's because it'll potentially draw investors away from Alibaba's own stock. This wouldn't be the first deal of its kind. Last year, a similar spinoff move was made by [ UNKNOWN ] Liberty Interactive Corporation, and its 22 % stake in Trip Advisor.

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