- Yahoo (YHOO) discloses its board recently authorized the company to continue pursuing the spinoff of its 384M-share Alibaba stake, in spite of the IRS' recent decision not to grant a private letter ruling stating the spinoff satisfies its active trade or business (ATB) requirement. It still aims to finish the transaction in Q4.
- Yahoo cautions the spinoff is still "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 SEC] and compliance with the requirements under the Investment Company Act of 1940, and other customary conditions." The company notes an IRS official recently stated new guidance planned for tax-free spinoffs won't apply to transactions that occur before the guidance is issued.
- Shares are up 3.1% after hours to $28.45, after falling 5.3% in regular trading amid a market rout.