HONG KONG: Shares in Chinas top e-commerce firm, Alibaba.com, slid more than 6% yesterday after the world's biggest software maker Microsoft dropped a bid for Yahoo, Alibaba's key investor.
Yahoo owns 39% of Alibabas parent, Alibaba Group, and Microsofts failure to win Yahoo means potential business opportunities Alibaba might have had with Microsoft, such as in advertising or online trading, would not now likely materialise.
The stock fall was largely expected as Microsoft dropped its bid for Yahoo, and there will be no news for Alibaba in the short term, said Antony Mak, sales director at DBS Vickers.
Shares in Alibaba, due to post quarterly earnings today, fell more than 6% to HK$15.22, lagging the benchmark Hang Seng Index which was off 0.25% by 0712 GMT.
But some analysts said the withdrawal of Microsofts US$33 per share bid would help remove some uncertainty as Alibaba Group had been touted as seeking investors to buy Yahoos stake in a move to stop Microsoft getting access to Alibaba stock.
The news is not so negative, but obviously investors are using this as an excuse to sell after a sharp rally last week, said Linus Yip, strategist at First Shanghai Securities Ltd. Reuters