Yahoo Incorporated is nearing a deal to sell 15 to 25 per cent stake in Chinese e-commerce company Alibaba Group that could worth US$4.8 billion to US$8 billion.

The California-based Yahoo acquired 40 per cent stake in Alibaba in 2005. The two companies have been in talks for two months about finding a way for Alibaba to buy back some stake owned by Yahoo.

In February, the two companies proposed a tax-free asset swap worth US$17 billion, however, it came undone.

“We are currently exploring a simplified transaction structure which, if executed, would provide greater certainty of closing to monetise a portion of our Alibaba stake,” said Yahoo CEO Scott Thompson.

The new deal nearing its closure is said to be tax-free and more straightforward.

“The overall complexity of this deal is much simpler. There’s no IRS risk, there’s no complications with regards to the identification of assets,” said a person familiar with the deal, who added that in a best case scenario, a deal could be weeks away.

“Of all the previous ones we’ve worked on, this one feels like it might actually have a chance of getting done. Or at least it did until a day and a half ago,” the person said.

To finance the deal, Alibaba needs to raise capital. The Chinese e-commerce company was valued at US$32 billion in September after investors including Silver Lake purchased a stake in the company.

GB