Alibaba Group will IPO as a Whole - Not as Parts

When it IPOs, expect one Alibaba Group IPO - not several parts IPOs.

Read the full Forbes post

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Why Did ISS Recently Advise Yahoo! Shareholders to Re-Elect the Board?

Yahoo!'s board has been one of the worst in Corporate America for 10 years. Why did influential proxy advisory firm ISS recently give them a "Thumbs Up"?

Read the full Forbes article here.

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How is Jack Ma Viewed Within China for What He Did to Yahoo!?

Many inside China, as well as outside, fear Jack Ma because of his and his company's market power.

Read the full post here on Forbes.

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What Will Jack Ma Do Next With Yahoo!?

Jack Ma's reputation has taken a bit of a hit in the US and China, since he yanked Alipay out of Alibaba Group and away from Yahoo! and Softbank. her's what's likely to happen next.

Please read the full post in Forbes.

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What’s Material and Immaterial to Yahoo! When Discussing Alipay?

Yahoo! says it has a formula to determine what Alipay is worth so they can properly negotiate with Alibaba Group. Investors should pay close attention.

Read the full post here at Forbes.

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Alibaba’s Last Offer to Yahoo! Valued Itself at $23.5 Billion. What’s Next?

Alibaba Group reportedly sought to buy back part of Yahoo!'s stake earlier this year, after the Alipay transfer. It suggests a deal between the two companies could come soon.

Read the full post on Forbes.

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Why Jack Ma Needs to Strike a Deal Now with Yahoo!

Jack Ma needs to keep his eye on the ball instead of the Yahoo! negotiations. Competitors 360Buy and Vancl are both planning to raise truckloads of cash in the next 6 months.

Read the full post at Forbes.

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Wall Street Journal China Opinion: 阿里巴巴和雅虎如何双赢？

My thoughts on the public feud between Alibaba Group and Yahoo!

Read the full post here at the Wall Street Journal China.

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Putting Taobao’s Size and Growth in Perspective

When you compare the size and growth of Taobao today, relative to Tencent and Baidu, the implied valuation of the private company (and Yahoo!) is staggering.

Read my full post on Forbes here.

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Don't Forget About Alipay - the PayPal of China

Alipay is the forgotten child in Alibaba Group. Yahoo! investors should pay more attention, as it's currently worth about $23 billion on its own.

Read the full Forbes post here.

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Pulling Back the Curtain on Taobao -- And Yahoo!'s Hidden Value

Taobao is the crown jewel within Yahoo!'s list of assets. It is a big reason why Yahoo!'s stock should be trading at $31 a share today - and much higher in the future.

Read the full post in Forbes here.

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Yahoo! Wears a Target Once Again

By Eric Jackson
RealMoney Contributor
4/25/2011 1:00 PM EDT
Click here for more stories by Eric Jackson

Kara Swisher's Good Friday post in The Wall Street Journal about several potential acquirers taking another look at Yahoo! (YHOO - commentary - Trade Now) was very interesting in a number of respects, and it should reignite the shares, which have languished since last fall, which was when Yahoo! was most recently the subject of buyout chatter.

• The story suggests that there is renewed interest among potential buyers of the core Yahoo! business.
• It suggests that the board of Yahoo! has changed its tune in terms of doing a deal for the company.
• It sounds to me that there is increased seriousness on all sides about doing a deal now.

Swisher is not someone who publishes for the sake of link-baiting. She takes her craft of journalism very seriously, and that is why she's the best at her beat.

According to Swisher, the current potential suitors for Yahoo! are the same as the old ones: News Corp.(NWS - commentary - Trade Now), Microsoft (MSFT - commentary - Trade Now), AOL (AOL - commentary- Trade Now), Disney (DIS - commentary - Trade Now), Providence Equity Partners and even Morgan Stanley (MS - commentary - Trade Now). And another player, former News Corp. president Peter Chernin, is also reported to be interested in doing a deal. What a deal might look like and what roles these various partners might play are topics that are still being bandied about privately.

The biggest open question from all the new information discussed in the post is, what will happen to Yahoo!'s stake in Alibaba Group? For example, if Providence and News Corp. and Microsoft all joined forces and bought Yahoo!'s core business, doesn't Alibaba (and Softbank for that matter) have a veto on this deal? This question came up at the time of the Microsoft bid, but to my knowledge it has never been answered.

Presumably, Alibaba would love to buy back Yahoo!'s 40% stake in Alibaba at a cheap valuation. If Alibaba did offer to do so at a low-ball valuation -- and if Yahoo!'s board accepted -- it would be offensive to Yahoo! shareholders.

As a Yahoo! shareholder, I have a hard time seeing how I'm better off with these assets under the care of News Corp., or Microsoft or Providence Equity or Peter Chernin. Are any of them going to pay me $60 for my shares? That's going to be a tough number to sell to any board. But Yahoo!'s shares are going to be worth that by 2015 -- by my estimates -- even if Yahoo! CEO Carol Bartz utterly fails to turn around the core business. That's simply from the expected growth of the private assets of Alibaba.

...

[*** This post is an excerpt of the full article, available by clicking here to go to RealMoney.com. Note: subscription required. ***]

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If China Stocks Are Being Revalued, Why Not Yahoo!?

By Eric Jackson04/20/11 - 08:00 AM EDT

NEW YORK (TheStreet) -- China Internet stocks are on fire. The unstoppable SINA(SINA_) is now up 106% year-to-date. SOHU(SOHU_) is up 56%. Baidu(BIDU_) is up 53%. Even new IPO Youku (YOKU_) is up 94% year-to-date.

We are now starting to see new Chinese companies rushing to list their stocks on the U.S. exchanges.Dangdang(DANG_) has managed to hold a price at a big premium to its December IPO. Qihoo 360(QIHU_) is another high-flying IPO from last month. RenRen(RENN), the "Facebook of China," is planning to list next month.

The more these relatively smaller stocks go up, the more it seems that the bigger Chinese portal names keep going up. Look at Sina's performance in the last two weeks alone for evidence of that.

China observer and investor Bill Bishop said on Tuesday that he thinks there is a revaluation going on in the Chinese Internet sector:

Most U.S.-Listed Chinese Internet stocks are soaring, with some up 10%+ Monday, and some up 30% or more in a matter of weeks. Many of these firms, like Baidu and Sina, have great businesses and massive growth prospects, but the surge seems to be about more than just fundamentals.

Are investors in relative valuation mode, believing that because immature firms like Youku (6.7B market cap), Qihoo (3.7B) and RenRen (planned IPO valuation is $4B+) are so richly valued, then Sina, Baidu, Sohu, Shanda et al are dramatically undervalued on a relative basis?

There is logic to that argument, and it can sustain high valuations for a while, especially given the great wall of money that is both being reallocated to China by Western funds and is sitting in Chinese hands looking for speculative opportunities.

I agree with his logic. I think this revaluation is going on.

And I agree with him that this is not a bubble. It could grow into one -- but we have a long way to go. In "dot com" era terms, I would characterize the current Chinese tech sector as being in the equivalent of the fall of 1995. Netscape went public that year in August. As its price held up for the first few weeks after, it made people reconceptualize the value of tech.Yahoo!(YHOO_) went public in April 1996. And, after that, the race was on for tech billions.

But it would not be for another 3.5 years after Yahoo!'s IPO that the "dot com" bubble burst.

I think we still have another four years of growth ahead of us in the Chinese tech world. Buckle up: it's going to be a fun ride.

But, here's a question for you: If there is a revaluation going on in the Chinese Internet world, it has so far eluded the biggest Chinese Web company in the world (at least, as I see the Chinese Web world playing out over the next five years).

Tencent and Baidu may be the big dogs today with $50 billion market capitalization each. And they will likely triple in size over the next five years, as the wealth of Chinese people increases and Internet penetration doubles or triples from its current levels.

.......

[** This post is an excerpt of the full article, which is available on TheStreet.com by clicking here. Free Site.**]

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Video: Yahoo! Trading at Half What It Should Be

Contributor Eric Jackson explains that in the disdain for the Internet company's stock, the true value of Taobao and Alipay is being missed.

Wed 02/23/11 08:00 AM EST -- Eric Jackson

Stocks in this video: YHOO | AMZN | EBAY | DANG | YOKU | MSFT

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Why I Love Yahoo!

By Eric Jackson02/23/11 - 08:00 AM EST

NEW YORK (TheStreet) -- I have had a love-hate relationship with Yahoo!(YHOO_) for five years now. I have always thought the stock was undervalued and primed for a turnaround that could unlock value. That's why I longed the stock and led an activist campaign against it. Unfortunately, even though the campaign resulted in former CEO Terry Semel quitting in 2007, the company's board muffed the chance to sign a deal with Microsoft(MSFT_) leading to the company's stock price to collapse. It's really never recovered.

Yahoo!'s new CEO is into her third year at the helm of the Internet company. Most investors and analysts are fixated on her efforts to turn the business around. When you listen to the earnings calls, 95% of the discussion from Carol Bartz and her CFO, Tim Morse, focuses on the wholly-owned business.

Yet, despite the company finally biting the bullet and doing needed layoffs and closing underperforming or overlapping businesses -- things that have been obvious to many for years -- my interest in Yahoo! is purely based on its private stake in Alibaba Group, the parent company of Alibaba.com, Taobao and Alipay.

There has been some general talk among investors who don't follow Yahoo! closely that Yahoo! should "monetize" the Asian assets. By this, I think they are suggesting that Yahoo! divest its stake in Yahoo! Japan and Alibaba Group. There also seems to be a lot of hope that private equity will come in and buy the wholly-owned company. Remember the spike-up in shares we saw a few months ago when rumors circulated that AOL(AOL_) was going to team up with private equity to make a bid for Yahoo!?

To me, all the private equity talk and concern about the current or future health of the Yahoo! core business is a side-show. I believe most of Yahoo!'s largest shareholders believe -- as I do -- that the real value-creation in Yahoo! shares will come when the market sees how big Taobao and Alipay are going to be in the next 10 years.

Let's do a sum-of-the-parts on Yahoo!

Tim Morse discussed last week that they are looking into a tax-free spin-off of their Yahoo! Japan stake. At recent market prices, Yahoo!'s 35% stake in Yahoo! Japan is worth $5.76 per share.

.......

[** This post is an excerpt of the full article, which is available on TheStreet.com by clicking here. Free Site.**]

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Yahoo!: Do The Right Thing for Your Shareholders with Taobao and AliPay

It's been a difficult 7 months for Yahoo! shareholders. Last week's shareholder meeting did little to quell concerns about the company's prospects moving forward.

Yahoo!'s board and management team essentially argued to shareholders in their presentation: trust us; we have a plan and we will execute against it.

I attended the meeting and asked about several governance-related incidents which have happened in the last year and have not been -- in my opinion -- in the interests of Yahoo! shareholders. The whole Vote-Gate announced earlier this week has been even more disconcerting.

It's sad to say, but I don't believe Yahoo!'s board or management team have done enough to deserve our respect and trust. Therefore, we need to continue to be vigilant and speak out for our own good.

I want to make Yahoo! shareholders aware of a potential scandal which has yet to occur. Hopefully, with enough pressure ahead of time, we can ensure it does not become a scandal. It relates to Yahoo!'s Asian assets, which have been much discussed in the last few months as a way of unlocking value for beleaguered Yahoo! shareholders.

As CFO Blake Jorgensen articulated during last week's shareholder meeting, Yahoo!'s collection of Asian assets (from its stake in Yahoo! Japan, to Alibaba in China, and Gmarket in Korea) are worth about $7 / share to Yahoo! shareholders at today's market prices. However, as Blake noted, Yahoo! maintains significant ownership (through its Alibaba stake) in two private Chinese companies: Taobao.com (China's eBay) and AliPay.com (China's PayPal).

Both have huge potential. They already are the leaders in their verticals in China. eBay just retreated from the Chinese market because of their inability to compete. They have also deliberately chosen to grab market-share in the past few years by not charging users fees. As you can imagine, these economics have helped their user-base explode. Neither company has minded doing this, because their costs are very low and they both know that they can turn the meter on at any time with a very large payback.

So, here's the governance issue: how should these assets be valued if Yahoo! wants to extract value from their stake in these private companies? If you valued them today, there are no revenues and negative earnings. If you valued them in a year or two when they each turn their meters on and generate hundreds of millions of dollars, you would have a much more valuable company.

There are two ways Yahoo! might extract value from Taobao.com and AliPay.com:

(1) agree to a Management Buy-out with each company's management or with Alibaba or;

(2) spin-off these assets to Yahoo!'s shareholders.

The latter option is the right thing to do for Yahoo! shareholders. Even if these shares are valued low today relative to what they will be in a few years after they start charging fees, Yahoo! shareholders can decide whether to hang on to them or not.

The Management Buy-out approach could be exploited. Alibaba or the management teams could decide to buy back Yahoo!'s stake at today's artificially low prices -- knowing full well they are buying an asset that will be worth 3 - 6 times as much in a very short time. Who wouldn't want that type of sweet-heart deal?

I do not know what Yahoo! is contemplating with these assets, but I believe sunlight is the best disinfectant. Better to bring this issue to light now and remind them to not even go there, then scream bloody murder after the fact when it's a done deal.

I wouldn't be as skeptical that such a sweet-heart deal might occur if I hadn't witnessed Yahoo! selling its $395 million / year Overture Japan business to Yahoo! Japan (Softbank) for $13 million last August. I asked Jerry about this deal last Friday. He said that Investor Relations had answered my question last year when I first raised it. (They didn't; they merely repeated Blake Jorgensen's public comments during two analyst calls which were vague and provided no clear rationale.) Jerry also suggested to me in his comments that there were "tax reasons" for doing such a deal, without further explaining. (Jerry: If there were such reasons, can you elaborate for the benefit of shareholders?)

Softbank got a great deal for Overture Japan. Alibaba shouldn't get a great deal for Taobao.com and AliPay.com. Yahoo! shareholders deserve to be treated fairly.

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