Business | Technology
Alibaba offers $2.3b buyback of e-commerce portal shares
Move follows drop in profit of online business part-owned by Yahoo!
- AFP
- Published: 00:00 February 22, 2012
- Image Credit: Bloomberg
- Jack Ma
Hong Kong: Chinese online giant Alibaba yesterday said it plans to buy back shares of its Hong Kong-listed portal Alibaba.com for $2.3 billion (Dh8.44 billion) to take it private, as the firm posted a drop in quarterly profits amid a sluggish global economy.
The group, which is 43 per cent owned by Yahoo!, said it was offering HK$13.50 ($1.75, Dh6.42) per share for Alibaba.com — the price at which the unit was listed in 2007, the group said in a statement to the Hong Kong Stock Exchange.
"Taking Alibaba.com private will allow our company to make long-term decisions that are in the best interest of our customers and that are also free from the pressures that come from having a publicly listed company," said group chairman Jack Ma.
"With this offer, we provide our shareholders a chance to realise their investment now at an attractive cash premium rather than waiting indefinitely during this period of transition." The news came as the internet commerce giant posted a net profit of 1.71 billion yuan (Dh997 million) in 2011, up 16.6 per cent over the previous year, but with weakness in the fourth quarter.
The firm said its fourth-quarter net profit fell 6.0 per cent from a year earlier, citing cautiousness due to a weak global economic environment. "The global economy was sluggish in 2011 due to lacklustre economic conditions in the major developed markets," Alibaba said in a statement.
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