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Alibaba! suspends! shares! amid! Yahoo! stake! buzz!

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Alibaba.com has suspended its shares on the Hong Kong market, pending news from its parent company Alibaba Group, which reportedly wants to buy back Yahoo!'s stake in the company.

The Chinese website asked the market to stop trading its stocks starting today, because it needed to sort out some stuff with Alibaba Group.

"The board of directors… announces that, at the request of the company, trading in the shares… will be suspended… pending clarification of speculation in relation to a transaction involving the controlling shareholder of the company, which may or may not impact the company and which may be potentially price sensitive," Alibaba.com said in a filing with the exchange.

That "transaction" is reportedly raising the necessary finance to buy back the share in the website that Yahoo! currently holds.

The group, according to people in the know who have been talking to Reuters, is in the middle of raising a $3bn loan from around six banks to finance the deal.

The grinding rumour mill was also theorising that the parent group might be thinking about delisting once it got its stake back, which helped propel Alibaba.com's shares up 5.47 per cent on Wednesday, to close at HK$9.25 (75.2 pence).

Yahoo!, once a web giant, has been watching its advertising revenue leak away to new firms like Google and Facebook and has come under huge pressure from its shareholders to shake things up. Their demands have resulted in the firm changing CEOs, having its chairman and three directors step down and has also seen co-founder Jerry Yang, who looked like he would cling on no matter what, resign. However, Yahoo! has yet to do anything about the sticky problem of falling revenues leading to not a lot of cash to fund a turnaround.

Much of the speculation about what Yahoo! might do to pick itself up has revolved around its Asian assets which are still valuable: these include the stake in Alibaba.com and a part of Yahoo! Japan which Yahoo! launched in partnership with Softbank Corp.

If Yahoo! sells its Asian assets to its Asian partners, it could raise enough money to try to do something about its ailing US business.

However, there have also been rumours that Alibaba and Softbank are thinking about teaming up with some private equity firms to buy all of Yahoo!

Alibaba.com didn't give any further information in its filing, but those "familiar" people told the Wall Street Journal that the bank loans were due to be finalised this month. ®

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