The whole Yahoo situation, i.e. putting its core business up for sale (unofficially), is completely non sensible and shows how broken the whole shareholder model can be sometimes.
Yahoo really is two different companies:
1. A tech company in gradual slow decline, but sitting on plenty of assets and in no immediate danger
2. A shareholder of Alibaba
Yahoo’s tech side of things is a traditional large tech company that does stuff. The investment side of things is a bunch of people who sit on their behinds all day watching their shares increase or decrease in value. It’s not like they’re trading them intelligently or researching to maintain a portfolio – they bought a big chunk of Alibaba shares in 2005 and are now just sitting around watching them.
The Alibaba shares are a huge chunk of money which is gradually declining in value. It would be prudent for Yahoo to sell these off to convert it into real money, which is what Marissa Mayer was planning to do until Yahoo’s shareholders learnt it might involve paying tax, which they considered outrageous. Tax is for poor people.
So Yahoo’s shareholders want Yahoo to sell of the core business instead because they think that Alibaba affects Yahoo’s share price more than Yahoo does, which means they think the core business is an unnecessary operating expense on a business that only really needs one person to sit and eat biscuits all day while occasionally typing ‘BABA’ into
The vision for Yahoo’s shareholders is that Yahoo’s shares becomes a proxy of Alibaba’s shares, which makes Yahoo shares highly sought after and therefore more valuable because…. everyone will say “Alibaba shares seems to be doing pretty well, I’m going to buy Yahoo shares”. I think they might be disappointed.