Reuters: Private Equity: China's CIC eyes up to $2 bln stake in Alibaba Grp - sources

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China's CIC eyes up to $2 bln stake in Alibaba Grp - sources May 24th 2012, 09:44 HONG KONG | Thu May 24, 2012 5:44am EDT HONG KONG May 24 (Reuters) - Sovereign wealth fund China Investment Corp (CIC) is in advanced talks to buy an up to $2 billion stake in Alibaba Group, sources told Reuters, as the Chinese e-commerce powerhouse looks to secure the last of the funding it needs to buy back part of its stake from Yahoo Inc. Yahoo and Alibaba struck a deal last week whereby the Chinese company agreed to buy back up to half of the 40 percent stake in itself held by Yahoo for $7.1 billion, valuing Alibaba at $35 billion. Alibaba is raising $4.6 billion of that target through an issue of preferred shares, bank loans and the sale of a stake to existing shareholders - Singapore state investor Temasek Holdings Pvt Ltd and DST Global. Another $2.5 billion in cash would allow Alibaba to fund the full $7.1 billion purchase. Sources with direct knowledge of the matter said CIC's $2 billion puchase of the Alibaba stake would help the e-commerce company complete its funding for the Yahoo purchase. Alibaba is also in talks with private equity firms that would assist in funding the remaining $500 million, sources said, including Bain Capital, Blackstone Group LP, and Hony Capital. The sources declined to be named because the discussions were private. Alibaba, Blackstone, CIC and Hony all declined comment. Bain could not immediately be reached for comment.

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