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Yahoo! has closed the $7.6bn stage of its sale of stock to Alibaba, bagging $4.3bn in cash after taxes and fees.

Alibaba has long wanted the share in its stock sold back to Yahoo! so it can have greater independence and go for its own stock market flotation in the next few years. But it took over two years of negotiations for cash-strapped Yahoo! to come to a deal with the Chinese firm.

Yahoo! has already promised the lion's share of the deal to its irate shareholders, tired of lower and lower returns from their investment. The web firm said in a canned statement that 85 per cent of the money will go to stockholders, totalling $3.65bn. That leaves around $650m for Yahoo! to try and turn its fortunes around with.

"The Yahoo! board and management have met, reviewed the strategy with regard to the proceeds, and are pleased to announce that we will be returning $3 billion of the proceeds to shareholders in addition to the 'down payment' of $646 million made over the past few months," newly-minted chief exec Marissa Mayer said in a tinned statement. "This yields a substantial return for investors while retaining a meaningful amount of capital within the company to invest in future growth."

Yahoo! had held a 40 per cent stake in Alibaba and with the deal done, it still holds 23 per cent, a tidy bundle it will no doubt be hoping to profit from when the Chinese firm floats.

"After an IPO, Yahoo! has the right to sell its remaining shares at its discretion following a customary lock-up period," we are told. ®

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