Yahoo!, SoftBank and Alibaba Group jointly announced that they have reached an agreement on Alipay. Under the agreement, Alibaba Group will continue participating in Alipay’s future financial performance, including a future IPO or other liquidity events. The agreement structures the relationship between Taobao and Alipay in order to preserve the value within Taobao, which provides that Alibaba group is appropriately compensated for the value of Alipay.
Alipay provides the payment processing services to Alibaba Group and some affiliates including Taobao, which is the largest online retail website in China, and to the third parties.
The agreement seems to be welcomed by all three parties. Jack Ma, Alibaba group’s chairman and CEO said, “The agreement is good for Alibaba Group and it’s stakeholders, as well as customers, employees and shareholders.” Yahoo CEO, Carol Bartz said, “As a result of this constructive process, we have an agreement that preserves the value of Taobao, provides for profit sharing at Alipay, and creates a structure to allow Alibaba Group to participate if Alipay’s value is realized in an IPO or other liquidity event.” Masayoshi Son, Soft Bank CEO also said, “This agreement was in part made possible by the strong long-term relationship and trust that exists between the principals at Alibaba Group, Yahoo and SoftBank, and also lays the foundation for Alibaba Group to continue its impressive growth under the dynamic leadership of Jack Ma.”
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