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Strategies & Market Trends : Mr. Pink's Picks: selected event-driven value investments -- Ignore unavailable to you. Want to Upgrade?

To: Cautious_Optimist who wrote (18628)	3/21/2012 11:29:04 AM
From: 2MAR$	Read Replies (1) \| Respond to of 18998

well not a bad buy off low $14's congestion low .....poor Yahoo, we love it but social networks stealing the thunder

To: Cautious_Optimist who wrote (18628)

5/21/2012 7:56:30 AM

From: 2MAR$

Read Replies (2) | Respond to of 18998

Yahoo! jumps 5.6% to $16.29 after reaching agreement with Alibaba (good job Daniel)

Yahoo! (YHOO) and Alibaba Group Holding (ALBCF) announced they have entered into a definitive agreement for a staged and comprehensive value realization plan for Yahoo!’s stake in Alibaba. The first step is the repurchase by Alibaba of up to one-half of Yahoo!’s stake, or approximately 20% of Alibaba’s fully-diluted shares. The purchase price will be based on a valuation of Alibaba to be established through equity financings that Alibaba intends to undertake to finance the transaction, subject to a floor valuation of approximately $35B. The agreement includes substantial financial incentives for Alibaba to raise the additional equity at a valuation higher than $35Bn. At the minimum price and assuming the initial repurchase of the full 20% stake, Yahoo! would receive from Alibaba consideration of approximately $7.1B, composed of at least $6.3B in cash proceeds and up to $800M in newly-issued Alibaba preferred stock. The agreement also establishes a framework for Yahoo! to monetize its remaining interest in Alibaba in stages. In addition to the share repurchase, the companies have also agreed to amend their existing technology and intellectual property licensing agreement.

Wells Fargo views Yahoo!'s agreement with Alibaba announced this morning as a a positive outcome that balances near-term shareholder capital return with potential upside of Alibaba growth longer term. The firm has a Market Perform rating on Yahoo! shares.

Yahoo said it intends to return substantially all of the after-tax cash proceeds to shareholders following the closing of the transaction with Alibaba. While the form of the return of capital to shareholders has not yet been finalized, Yahoo!’s board has increased Yahoo!’s share buyback authorization by $5B concurrently with the transaction