Last week, Yahoo (NASDAQ:YHOO) announced a spinoff of its shares of Alibaba, bundled with an "active trade business" to meet tax requirements. In a blog post, Yahoo Small Business head Amer Akhtar revealed his unit would be the one spun off in the final quarter of 2015 into a new unit called SpinCo.
"What this means is that Yahoo Small Business will move over to the newly formed public company, along with Yahoo's approximately 384 million shares of Alibaba. With this new opportunity, we can invest even more in our platform and chart our own course," said Akhtar in his blog.
The transition will continue over the coming months and Yahoo Small Business employees will be invited to join the new company. The transaction is expected to be completed in the fourth quarter of 2015.
Yahoo Small Business is the company's division that sells tools to help small business owners market and sell their goods online, according to the Wall Street Journal's Digits blog. While the purpose of SpinCo was to unlock the value of shares and save investors billions of dollars on taxes, the new unit was necessary as Yahoo needed an active trade or business.
SpinCo will operate under new management and a new board of directors. The small business group currently makes about $50 million a year.
Yahoo Small Business also recently announced the launch of Store, an e-commerce platform that helps retailers start, build and grow businesses online. Store is the latest digital initiative from Yahoo, which is actively competing with other search engines in the e-commerce game. In spring, Google (NASDAQ:GOOG) piloted a program to help retailers understand how their online ads were generating in-store sales.
-See this Yahoo Small Business blog
-See this Wall Street Journal blog
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