Yahoo grabs 10% of China's Biggest e-Commerce website

China-based Alibaba might not be a household name but chances are that the MP3 player you purchased at your local car boot sales was once displayed on its website.

Yahoo has just purchased 10% of Alibaba.com Limited in a Initial Public Offering for about USD 100 million (roughly £50 million).

Alibaba.com and Yahoo have had a long term relationship with Alibaba taking over Yahoo's Chinese operations back in August 2005.

Back then, Yahoo invested another USD 1 billion in cash to give it a 40% share in the company.

Alibaba is the biggest Business-to-Business ecommerce website in China with nearly four million registered users and the group behind it has expanded its business into the fields of consumer e-commerce (with Taobao), online payment services (Alipay) and software services (Alisoft) as well.

The increased partnership is expected to give Yahoo more leverage as it takes on Google and Baidu in the Chinese market.

Investment bank Goldman Sachs expects Alibaba's profits to be nearly three times more than in 2006.