Alibaba, Yahoo, Softbank reach pact over Alipay

Reuters News
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Posted: Jul 29, 2011 8:28 AM
Alibaba, Yahoo, Softbank reach pact over Alipay

NEW YORK (Reuters) - Alibaba Group said it has reached an agreement with Softbank Corp and Yahoo Inc that promises Alibaba could receive up to $6 billion from an initial public offering or liquidation of its e-payment unit, Alipay.

The agreement between the three parties capped off months of intense negotiations sparked by a highly public spat over the transfer of Alipay to a company wholly owned by Alibaba founder Jack Ma, a move that Yahoo claimed it was not aware of.

Under the terms of the deal, Alibaba Group will receive no less than $2 billion and no more than $6 billion in proceeds from an initial public offering of Alipay or other "liquidity event".

Yahoo shares rose 6.7 percent to $14.40 in premarket trading.

(Reporting by Melanie Lee in Shanghai, Writing by Franklin Paul in New York; Editing by Derek Caney)