Sloan: Confused about the to-do at Yahoo? You can thank the IRS for that.

Signage identifies the Yahoo! corporate headquarters in Sunnyvale, Calif. | Courtesy of Yahoo/Flickr
Yahoo finds itself under pressure from investors due in large part to the IRS, Allan Sloan says. | Courtesy of Yahoo/Flickr

Let me try to explain what’s going on with Yahoo. And to tell you why I think that the company is likely to unload its iconic Internet businesses to placate the “activist” investors that are chewing on it.

It has to do with an IRS ruling — or rather, the lack of a ruling.

To give you the simple version, Yahoo is paying the price for having had much more success acquiring stakes in other companies than running its own businesses.

As a result, Yahoo’s holdings in two big Asian Internet companies — Alibaba of China, and Yahoo Japan — are now worth much more than Yahoo’s own operations are. That’s why activists think they can profit by slicing and dicing Yahoo.

Read more from the Washington Post


Allan Sloan is a columnist for The Washington Post. He is a seven-time winner of the Loeb Award, business journalism’s highest honor. View Archive


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