WSJ article tonight say Goldman Sachs prohibiting messaging on Bloomberg, AOL and other messaging platforms. Only allowing Enterprise IM from Blackberry or MSFT Lync.
$1.6bn for the real estate (all of it excluding data centers) and additionally up to $1.1bn for the data centers.
I'll let you guys figure out what that works out to per share.
Gloom is perpetually wrong on Alibaba. He still doesn't get the difference between gross and net revenue. The article refers to gross revenue and Alibaba reports net. The accounting concept is over his head. As per Eric Jackson, Alibaba is already blowing Amazon away on profits, which are the same regardless of which way you report the revenue.
The first rule of bashing is don't be an idiot. Gloom shouldn't be lecturing anybody.
You have been perpetually wrong on Alibaba, and are wrong again. The Euromonitor report reflects Gross Merchandise Value transacted on the platform, which Tmall will overtake AMZN in during 2015. They report revenue differently, with AMZN reporting Gross revenue and Alibaba reporting Net revenue in the Yahoo financials. The businesses are directly comparable at the operating profit level. The crazy thing is that Alibaba did $374mm in operating profit in the June quarter alone and AMZN is forecast to do $500mm in operating profit for all of 2012. Alibaba not only blows away Amazon in revenue growth today (70% year-over-year vs. 30%), but it demolishes AMZN in terms of profitability. Better growth and much better absolute profits today than AMZN. Alibaba valued at $40bn via Yahoo, AMZN valued at $114bn. One of those two sounds pretty cheap.
While various posters have called the reports of the Alibaba Group transactions of Fall 2011 into question, hard facts are provided in the Alibaba.com take private offering circular posted last week.
Page 155 shows Jack Ma as having 186 million shares of the Offeror (in this case Alibaba Group), representing a 7.41% stake. This implies 2.5bn shares (186/0.0741) outstanding for Alibaba Group.
On page 157, the circular outlines share sales last Fall by the management of the Offeror at US$13.50 per share.
US$13.50 x 2,510 million shares = US$33.9bn valuation. Yahoo's 40-42% stake is hence valued at $13.5-14.2bn, conforming with the footnotes provided in their quarterly earnings presentation indicating an implied value for their Alibaba Group stake at just over US$14bn.
Subsequent to the transactions, Alibaba Group posted a very strong 4Q11, as reflected in Yahoo's 1Q12 earnings.
So much for that theory - doh!
Yahoo does a little better with 14,000 employees. Wonder if that is why private equity guys are interested. Maybe Yahoo's "talent" surplus needs to be trimmed.
Buybacks do enhance the value per share. At the same time a special dividend accelerates the return of capital. A special dividend of $4-5 would also make shorting a very expensive proposition. They actually will have enough cash to do both.
Actually given Yahoo's history, investors have priced in a significant discount due to lack of confidence that the outcome is achieved. As it becomes clearer, the discount will evaporate. Also, the value of the Asian stakes is unclear to many U.S. investors. Your friend Farmertilman is certain the Alibaba stake is only worth $1bn. As that debate gets resolved, the shares will react accordingly.
$1bn is very different from $15bn
For 25% of Alibaba Group - Yahoo gets $6bn cash, and a stake in profitable Alibaba.com - TAX FREE. And it retains 15% of Alibaba.
Assuming a 2/3 cash, 1/3 operating asset mix to fit tax rules, the stake would be $3.23bn or over 50% of Alibaba.com, and this would = $9.3bn for 25% of Alibaba Group. That implies a $37 bn value for all of Alibaba Group, and that the remaining 15% stake is worth $5.5bn with a likely IPO on the way.
All-in $14.8bn for the 40% Alibaba Group stake = $12 per share. If Yahoo Japan stake sale comes through, you're looking at another $5. Plus $2 of net cash at Yahoo already = $19, before you value Yahoo biz at all. With ~$0.60 of annual cash flow there, you're looking at another $6, so $25 all-in. If the remaining Alibaba stake doubles, you're at $30.
NY Times said Yahoo's bankers would be getting back to the minority stake bidders with feedback on Friday the 2nd. It also said they had expected bids to be a few dollars higher.
So PE firms should be coming back at $18+. The next bid-evaluate-respond cycle should play out this week. I doubt a final decision will be made tomorrow. The only things we should expect this week are 1) any unsolicited bid from Alibaba for all of Yahoo or 2) leaks of revised minority bid prices.
Andreessen is crazy overhyped. Guy is an egomaniac who overpays to get into interesting VC deals and has been nothing but a disaster on HPQ's board. Yahoo really willing to give Silver Lake a sweetheart deal to find out he's over-rated?
Netscape - failed vs. MSFT IE
AOL - ugly
HPQ - disaster
YHOO - savior? unlikely.
Board member David Kenny pimping himself out to PE firms as a CEO candidate tells you everything you need to know about where this is headed. He sees where his (and our) bread will be buttered.
News Corp has been mentioned as a joint bidder multiple times. Via WSJ and All Things D, News Corp has been on a campaign to talk down the price, using their media assets, even as they are widely known to be interested bidders. Kara Swisher said MSFT wasn't interested, just before it was widely reported on Reuters and elsewhere that they are indeed looking to participate. WSJ floated the bogus $16-18 to keep the price down. They are leveraging their mouthpieces at the WSJ and All Things D to seed the market with disinformation designed to undercut the bid price and understate the bidder interest.
Perhaps this is the same reason MSFT is funding a bid instead of buying YHOO itself. Antitrust issues may make it tough to own it outright for both GOOG and MSFT. But they may have a strong incentive to keep the search patents out of Apple's or Alibaba's hands. Apple has no antitrust issues.
Based on the interest from GOOG and the anti-trust issues that would come with it, could GOOG just be helping fund a bid to keep something away from somebody else?
Would it be to keep fundamental search patents out of the hands of...Apple?
Look what GOOG bid for MMI just to get patents for smartphones. Apple has the cash, a leading mobile OS, browser (Safari) and a basic ad platform (iAds). The only things it lacks is search, but that is a tough nut to crack absent patents that Yahoo owns.
I'd think YHOO properties would be subject to MSFT search deal, but Apple could leverage the search patents of Yahoo to run its own algorithmic and paid search across non-Yahoo assets like Safari, OS X, iOS and the App Store. If Apple gained enough search share across Safari and iOS, it could trip up the MSFT-YHOO agreement and give YHOO an out in early 2013.
Yahoo's search patents (algo and paid) are the key to broader search ambitions held by Apple and Alibaba.