Yahoo said on Monday that it will go forward with Alibaba shares spinoff even if the IRS doesn’t give its approval.
That would seem to suggest that Yahoo intends to spin off its 384 million shares of Chinese e-commerce company Alibaba Group even if it means incurring a hefty tax bill.
Yahoo shares were up 3.7% to $28.62 in extended trading on Monday.
Here’s the relevant portion of Yahoo’s filing:
On September 23, 2015, Yahoo’s Board of Directors authorized the Company to continue to pursue the plan for the Aabaco spin-off transaction as previously disclosed, except that completion of the spin-off will not be conditioned upon receipt of a favorable ruling from the IRS. The spin-off transaction will continue to be subject to certain other conditions, including final approval by Yahoo’s Board of Directors, receipt of a legal opinion with respect to the tax-free treatment of the transaction under U.S. federal tax laws and regulations, the effectiveness of an applicable registration statement filed with the Securities and Exchange Commission (“SEC”) and compliance with the requirements under the Investment Company Act of 1940, and other customary conditions, each of which conditions may be waived, in whole or in part (to the extent permitted by law), by Yahoo in its sole discretion.
On September 28, 2015, Aabaco filed Amendment No.1 to its Registration Statement on Form N-2 which is available on the SEC’s website at www.sec.gov using the name Aabaco Holdings, Inc.
Completion of the transaction is expected to occur in the fourth quarter of 2015, subject to the conditions described above.