Yahoo shares are up 7 percent in pre-market trading now that the company has reached a deal with Alibaba and SoftBank over the Alipay web payment service. Alipay was a spin off from Alibaba as a separate company without the consent of Yahoo, which owns 43 percent of Alibaba.
The agreement stipulates that Yahoo will get 37.5 percent of the money raised in the event that an IPO is released for Alipay or the company is sold. Some analysts are already wondering whether this is not bad news for Yahoo, which, at one point, owned 100 percent of the company. Attempting to translate the legalese jargon, Kara Swisher of All Things Digital translated it as, “That’s China, folks, so suck it up!”
Yahoo shareholders were relieved, however, to see an end to the long-standing battle between Yahoo and Alibaba. Yahoo’s stocks have absorbed blow after blow during the episode, and observers are relieved to see that it has finally come to an end. “This is a good outcome for Yahoo and for our shareholders,” said Yahoo CEO Carol Bartz.