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RETAIL FUNDS | Cesar Tordesillas, China
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Alibaba dealing with CIC on buyback plan

Sources said that Alibaba Group has been in talks with China Investment Corp on investment possibilities.

Alibaba Group intends to sell a stake to sovereign wealth funds to finance its plan to buy back shares from Yahoo! This was announced by Alibaba's founder and CEO Jack Ma.

Ma said that the company, China's largest e-commerce player, is now inviting investments from firms such as China Investment Corp and Singapore-based Temasek Holdings

Pte, with the aim of shaping a "healthy shareholder structure" to ensure the management's control on the company.

The CIC, as well as the new stockholders to join in the future, will be required to surrender its voting rights to Alibaba as a pre-condition to the potential investment deals.

Some other sources said that the CIC is to invest US$2 billion to help the company raise enough money for its buyback plan.

Temasek is already an investor in Alibaba. Last September, Temasek, DST Global and Silver Lake bought 5 percent stake in the company with US$1.6 billion.

Alibaba is raising some US$4.6 billion through various channels, including issuance of preferred stocks, bank loans, and selling stakes to its current stockholders.

It's also said to be negotiating with some private equity firms, including Bain Capital, Hony Capital and Blackstone Group.

Alibaba and Yahoo reached an agreement last month on a repurchase plan for half of Yahoo's 40 percent stake in the Chinese company for about US$7.1 billion.

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