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Yahoo planning to sell stake in Japanese search portal

Yahoo may be planning to sell its 35.5 per cent share of Yahoo Japan, the web portal co-owned by wireless carrier SoftBank.

It is the second big move by Yahoo under CEO Marissa Mayer in the Asian region, the first being the spin-off company created for the £26 billion stake in Chinese e-commerce giant Alibaba.

Mayer said in a video call for the first quarter earnings that it is looking to sell its stake in Yahoo Japan, although it did not mention a buyer. Yahoo Japan is a separate company, and generated £166 million in revenue for Yahoo in 2014, but under Mayer’s new restructure most of the efforts are being pushed at home in the US.

It is still not confirmed whether Yahoo will look to sell all its stake, half, or a small amount. Even though Yahoo Japan is a provider of some revenue to Yahoo, the removal of its stake in Japan would allow the closure of more offices in the region.

Yahoo’s recent acquisitions of Tumblr for £730 million, Brightroll for £425 million and Flurry for £113 million show it wants more investment into social, analytics and advertising, and it is sticking away from investing in the Asian region.

The concentrated effort on US growth might come to haunt Yahoo, who has not been well received in North America for over a decade. Even with Microsoft’s Bing market share going above 20 per cent, Google is still the main search engine and advertising agency online, and Facebook appears to be quickly becoming second best.

If Yahoo starts selling off its impressive Asian portfolio, Mayer may come under even heavier fire from investors, who are clearly unimpressed with the restructuring effort given the lack of revenue or profit growth.