Yahoo Considering ‘Selling Off’ Core Business

The Yahoo Inc. board of directors is considering a plan to sell off the company’s troubled internet business, according to a report in the Wall Street Journal.

People told The Wall Street Journal that Yahoo’s board is expected to discuss its options in sessions that will begin on Wednesday and continuing through Friday.

It is unclear what the board’s decision will mean for the future of Yahoo Chief Executive Marissa Mayer, who has pushed for the spin-off of the Alibaba stake but has not publicly commented on the possible sale of the core business.

At least three unnamed private equity firms have recently looked at buying Yahoo’s internet business, according to the Financial Times.

This could help Yahoo dodge capital-gains taxes on its investment in Alibaba, which was bought a decade ago for a billion United States dollars (£670 million) and is now worth 33 billion USA dollars (£22 billion) as the ecommerce business has boomed.

The hedge fund was anxious about the plan to transfer the Alibaba stake to the new company and distributing stock in what could amount to a taxable gift of some $30billion to shareholders.

After such a sale, all that would be left, essentially, is the Alibaba and Yahoo Japan stakes.

Yahoo has planned to spin off its 15pc stake in Alibaba, but has run into difficulties over the taxes such a move would accrue, with American authorities warning that its elaborate restructuring plan created to avoid taxes on a spinoff would not pass muster.

Yet, Yahoo has lost advertising market share in key areas such as mobile, where rivals such as Facebook and Google have gained ground. The deal lifted Yahoo’s user base to about 1 billion but did not bring in advertisers. However, Verizon Communications raced ahead and acquired AOL for $4.4 billion.

During Mayer’s 13-year tenure at Google, she led the Google Earth, Gmail and Google News teams and is credited with helping create the company’s celebrated search page.

Ex-Googler Marissa Mayer took over as CEO of Yahoo in 2012 and since then she has been trying to revive Yahoo by expanding more into media and complete overhaul of core products like Mail, Finance, Sports, Weather and Flickr.