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Thu Oct 14 2010 14:32:49

Could eBay Acquire Yahoo's Stake in Alibaba?

By: Ina Steiner

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As we noted in AuctionBytes Newsflash this morning, the Wall Street Journal reports that AOL is considering acquiring Yahoo, and that one of the scenarios under discussion is a deal in which China's Alibaba Group would buy back Yahoo's roughly 40% stake in Alibaba.

Wall Street analyst Sandeep Aggarwal of Caris & Company, who is bullish on eBay, published a report today saying he believes eBay could be interested in buying Yahoo's stake in Alibaba. "In our view, Yahoo! choosing to become part of private equity is less likely but the probability of Yahoo! selling its stake in the private assets of Alibaba sooner than expected is very high."

Why does he think eBay could be a buyer? eBay has $5 billion in cash sitting offshore, and, "with a partnership with Alibaba, eBay can not only start getting millions of listings from Taobao but can also preempt any competitive move for global expansion by Taobao/Alipay."

It's an interesting theory given many readers who post on this blog believe Alibaba is interested in acquiring eBay. Forty percent is still a minority share - I'm not sure how eBay would be able to exert any more control over Alibaba than Yahoo was able to with its 40% ownership.




Comments (10) | Permalink

Readers Comments

Could eBay Acquire Yahoo's Stake in Alibaba?   Could eBay Acquire Yahoo's Stake in Alibaba?

by: RicRoe

Thu Oct 14 16:17:37 2010

If I were Jack Ma, I would do what ever was necessary to buy back Yahoo's stake in Alibaba and prevent eBay from acquiring that 40%.   Hopefully, their deal with Yahoo is structured in a way that gives Alibaba the first position when it comes to buying back the 40% Yahoo owns in their company.

Why would Jack Ma want eBay as a minority partner?

About  the only thing eBay could bring to the table is money, and Alibaba is not exactly short on cash..

eBay previously demonstrated it did not possess the tools or intelligence necessary to be successful in China, and ran from that market with it's tail between it's legs.

eBay has also proven that they are undesirable as a minority partner.

Just ask the guys at Craigslist how well it has worked out once eBay got inside their hen house.

If eBay were to acquire Yahoo's stake in Alibaba, the Craigslist scenario would likely play out all over again. eBay would infiltrate Alibaba through the boardroom, learn what they do not know, apply it poorly as usual, and attempt to re enter  the market in China.

eBay has proven they can not be trusted, Jack Ma does not need the headaches that would certainly come in any deal with eBay.


Could eBay Acquire Yahoo's Stake in Alibaba?   Could eBay Acquire Yahoo's Stake in Alibaba?

by: unaware This user has validated their user name.

Thu Oct 14 17:13:44 2010

Great... one more company that eBay can mess up!

Could eBay Acquire Yahoo's Stake in Alibaba?   Could eBay Acquire Yahoo's Stake in Alibaba?

by: Rick1313

Thu Oct 14 18:00:45 2010

Well, Sandeep Aggarwal of Caris & Company seem to only be half right, re: eBay,inc. = bullish.

The first half, ''bull'', is right.

They kind of got the second half mixed up. The ''i'' is in the wrong place and they are missing a ''t''.

Seeing how eBay,inc. likes to redefine the actual meaning of words to justify their site changes, and how they like to count one user who has, say, 15 registered id's, as 15 unique users, and counts a seller looking at his/her own items as an individual unique view count, I can see then eventually saying that 40% is a majority because they say so.

I do believe that was the longest sentence I ever wrote.

Could eBay Acquire Yahoo's Stake in Alibaba?   Could eBay Acquire Yahoo's Stake in Alibaba?

by: Patricia This user has validated their user name.

Thu Oct 14 19:28:46 2010

Eventually, I feel its going to be the other way around with Jack Ma acquiring Ebay.  Didn't Yahoo Japan team up with Alibaba already?

Could eBay Acquire Yahoo's Stake in Alibaba?   Could eBay Acquire Yahoo's Stake in Alibaba?

by: Smitty This user has validated their user name.

Thu Oct 14 21:05:41 2010

@ Patricia

''Eventually, I feel its going to be the other way around with Jack Ma acquiring Ebay.''

I think you are correct.

When I think of a match/fight between our boy JD and Jack Ma. I Think of Jack as Mike Tyson and JD as Michael Jackson.

BTW, I'm getting a little tired of reading about that 5 billion stashed offshore and ebay spending zilch on advertising.

Smitty

Could eBay Acquire Yahoo's Stake in Alibaba?   Could eBay Acquire Yahoo's Stake in Alibaba?

This user has validated their user name. by: Ming the Merciless

Thu Oct 14 23:32:02 2010

This is where the rubber meets the road.

Chinese corporations gobbling up American companies and American and Canadian jobs isn't good for North America.

As FUBARed as Donahoe's made ebay, however, selling ebay to Alibaba might have been The Ho's BainGame plan all along. If not, his choices are rapidly diminishing as the key ebay.com metrics continue to tank.

John Donahoe is anti small business, anti labor, and anti American.

DEATH to ebay corp. in 2010.

Could eBay Acquire Yahoo's Stake in Alibaba?   Could eBay Acquire Yahoo's Stake in Alibaba?

by: Another Wronged Seller This user has validated their user name.

Fri Oct 15 00:17:06 2010

I absolutely agree Jack Ma should do whatever it takes to keep that 40% out of ebays grasp. The more I read on the craigslist trial, the more unbelievable it is at ebays behavior. The ebay execs that sat on the CL board should be prosecuted in criminal court for their mis-use of the CL data. As pointed out above, hopefully the yahoo deal was structured so Alibaba had right of first refusal to buy back the shares.

Jack, Don't go swimming with sharks!

Could eBay Acquire Yahoo's Stake in Alibaba?   Could eBay Acquire Yahoo's Stake in Alibaba?

by: Patricia This user has validated their user name.

Fri Oct 15 12:49:06 2010

Jack Ma may be small but as far as sharks go "you're gonna need a bigger boat" is something any competitor to him should think about.  ;-)  The chinese said they wanted world dominance in the online sales game.  Buying out Ebay eventually would go a long long way to that goal.

Could eBay Acquire Yahoo's Stake in Alibaba?   Could eBay Acquire Yahoo's Stake in Alibaba?

This user has validated their user name. by: Bidofthis.com
Web Site

Sat Oct 16 11:14:33 2010

Perhaps a better buy would be all their search assets Inktomi, Altavista, alltheweb.
Yahoo abandoned search for Bing.

Raise search from the dead.



Could eBay Acquire Yahoo's Stake in Alibaba?   Could eBay Acquire Yahoo's Stake in Alibaba?

by: eBay's Angels

Sat Oct 16 17:54:51 2010

per Wiki: Taoba is an online destination for shopping, socializing and information sharing in China operated by Alibaba Group

Just what eBay needs, more fake North Face and other designer brands.



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