SHANGHAI Yahoo Inc, China's Alibaba Group and Japan's Softbank Corp said on Wednesday they have made "substantive and encouraging progress" toward an agreement over the ownership of the Chinese company's Alipay e-payment unit.
The three firms are locked in a high profile tussle over the
transfer of Alipay to a company owned wholly by Alibaba founder Jack Ma.
Alibaba, which is 40 percent owned by Yahoo and about 30 percent owned by Softbank, has said the transfer of Alipay was necessary to comply with new Chinese regulations that restricted foreign ownership in e-payment companies.
Yahoo and Alibaba reached a preliminary agreement on Alipay last month, but the deal still requires the consent of Masayoshi Son, Softbank CEO and an Alibaba board member.
Son said earlier this week the Japanese mobile carrier expects to reach an agreement soon with Alibaba on Alipay.
"Our objective is to reach an agreement in a timely manner that serves the interests of all stakeholders. The companies will not comment in further detail until it is appropriate to do so," the companies said in a joint statement on Wednesday.
Yahoo and Alibaba's relationship has long been rocky. Observers say Yahoo has bristled at the way it has been sidelined on major decisions, while Ma's company has been rebuffed by Yahoo in attempts to buy back some of the U.S. company's invested stake.
Some investors believe Yahoo's major assets in Asia could potentially be worth as much as Yahoo's entire current market value and are betting that an IPO by privately held Alibaba, or one of its subsidiaries, could boost Yahoo's valuation.
Shares of Alibaba.com, a unit of Alibaba Group, spiked up more than 7 percent in early trade on Wednesday, although analysts said it was due to the rebound in U.S.-listed Chinese technology stocks overnight.
"Investors are broadly bargain-hunting today, but tech gains are also a carry over from the overnight gains in Chinese tech stocks on Nasdaq," said Jackson Wong, vice president at Tanrich Securities in Hong Kong.
U.S.-listed Baidu rose 8 percent and Sina Corp jumped 18.6 percent on Tuesday.
Alibaba.com shares had tumbled 5.4 percent on Friday after Alibaba Group unveiled it has reorganized Taobao, China's largest e-commerce website, into three separate companies, squashing any chance of a Taobao public offering.
(Reporting by Melanie Lee,; Additional reporting by Clement Tan in HONG KONG; Editing by Kazunori Takada and Muralikumar Anantharaman)