September 8, 2011 AT 12:00 am

Will Alibaba buy Yahoo to get out of Yahoo?


Will Alibaba buy Yahoo?

Could Alibaba make a run at Yahoo? Well, maybe. Let’s think about this: Alibaba is worth an estimated $27.5 billion (using the recent [subsidiary] Alipay transaction as a proxy), and currently Yahoo’s market cap is about $16 billion.

Industry observers clearly know Jack Ma, CEO of Alibaba, wants to reacquire part if not all of the 43% stake Yahoo holds—and could just buy the company outright. This scenario could work if Alibaba partners with a financial partner (private-equity firm) to spin out or operate the other businesses (mail, finance, sports, omg) as private entities.

Organizing to make this happen might be tough, but might be worth it if it is strategic enough to own. A recent Yahoo 10-Q filing shows that Alibaba’s private assets have also performed well and losses have come down sequentially in the March 2011 quarter, while revenue was up 150% year-over-year.

We’ve been following this for awhile, the big tech news this week was the Carol Bartz is out of Yahoo, but no one is really talking about Alibaba here in the USA.

Will Alibaba’s CEO end up running Yahoo! ?
Softbank CEO sees Alipay agreement with Alibaba soon
Alibaba to split, not IPO, e-commerce unit Taobao
Alibaba and Yahoo (and eBay)

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  1. Paul J. Ste.Marie

    Amazing that Alibaba is so profitable. The scam density always seems to be pretty high. Do you ever find suppliers there?

  2. @paul, not so much.

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