Report: Yahoo may buy $1B stake in Chinese Web site
Yahoo Inc. is in talks to buy a 35 percent stake in Chinese Web auction site Alibaba.com Corp. for nearly US$1 billion, according to a report Monday from Forbes.com.
Such an investment would be the biggest in China's Internet industry to date, the report said, and would come on the heels of one of the most successful initial public offerings ever for a Chinese dot-com. It could also foretell the start of an Internet boom in China, home to the world's second largest Internet audience.
The Forbes report cited unnamed sources close to the negotiations. Yahoo, in Santa Clara, California, could not immediately be reached for comment, and a spokesman for Alibaba.com declined to comment. "We don't comment on rumor or speculation," said Porter Erisman, Alibaba.com's vice president of corporate marketing.
A deal with Alibaba.com would put Yahoo in a better position to compete against eBay Inc. in China. Alibaba runs three popular online marketplaces in China, http://www.alibaba.com, http://china.alibaba.com and http://www.taobao.com. The company's Taobao.com site competes directly against eBay's China auction operations, while Alibaba.com is an international business-to-business e-commerce site, and China.alibaba.com is a business-to-business e-commerce site for Chinese companies.
On Friday, Chinese Internet search site Baidu.com Inc. rode a recent craze for Chinese Web stocks to one of the best one-day gains in recent memory, rising 354 percent on its opening day to close at $122.54 per share on the Nasdaq stock exchange. The company, which operates one of China's most heavily used search engines at http://www.baidu.com.cn, opened the stock trading day at just $27 per share.