China grants Alibaba payment system license

May 26, 2011

(AP) -- An online payment system founded by Chinese e-commerce giant Alibaba Group was granted a government license, the company said Thursday, following an ownership change that rattled investors in partner Yahoo Inc.

Alipay was among the first group of companies to be awarded licenses by China's central bank to conduct online payments, Alibaba said.

Yahoo, which owns 43 percent of Alibaba, disclosed May 10 that Alipay had been spun off into a separate entity controlled by Alibaba CEO Jack Ma.

The loss of a potentially valuable asset in the world's most populous jarred investors and Yahoo's stock price has fallen by 13 percent since then.

Yahoo said the change was necessary because Beijing would only license a payment service wholly owned by Chinese citizens. CEO Carol Bartz said this week Yahoo is negotiating with Alibaba and will be "appropriately compensated."

Launched in 2004, Alipay says it is China's biggest third-party online with more than 550 million registered users as of December.

Alibaba Group operates Yahoo's China arm, China Yahoo! It also includes Alibaba.com, a major business-to-business e-commerce service, the retail site and Cloud Computing, a developer of computing services.

Explore further: Sony's quarterly loss balloons on mobile woes

not rated yet
add to favorites email to friend print save as pdf

Related Stories

Yahoo! shares drop as Alibaba service spins off

May 12, 2011

Yahoo! stock sank on news that Alibaba has spun its online payment business out of reach of the US Internet pioneer, which owns a large stake in China's leading online search service.

Yahoo! shares sink on Alibaba tensions

May 13, 2011

Yahoo! shares extended their slide on Friday amid tensions with Alibaba Group, the Chinese e-commerce giant in which the California Internet company holds a large stake.

Yahoo, Alibaba: We're 'committed to' negotiations

May 16, 2011

(AP) -- Yahoo Inc. and Chinese Internet company Alibaba Group tried to present a united front Sunday as they worked on a dispute that has caused tension in their already strained relationship. ...

Alibaba head rejects Yahoo! protest over pay unit

May 15, 2011

The head of Chinese e-commerce giant Alibaba said Saturday the firm's move to transfer ownership of its online payment unit was "legal and 100 percent transparent", rejecting protests by US-based Yahoo!

Recommended for you

Sony's quarterly loss balloons on mobile woes

6 hours ago

Sony's losses ballooned to 136 billion yen ($1.2 billion) last quarter as the Japanese electronics and entertainment company's troubled mobile phone division reported huge red ink.

Will Apple Pay be mobile pay's kick-start?

14 hours ago

If anyone can get us to use our smartphones as wallets, it's Apple. That's what experts think about the recent launch of Apple Pay, the first mobile wallet to work on an iPhone.

Google execs discuss regulation, innovation and bobble-heads

16 hours ago

Eric Schmidt and Jonathan Rosenberg help run Google, one of the world's best-known, most successful - and most controversial - companies. They've just published a new book, "How Google Works," a guide to managing what they ...

LinkedIn reports 3Q loss but sales climb

17 hours ago

LinkedIn Corp. posted a third-quarter loss on Thursday, but its results were better than expected as revenue grew sharply, sending shares of the online professional networking service higher in extended trading.

User comments : 1

Adjust slider to filter visible comments by rank

Display comments: newest first

MorganW
not rated yet May 26, 2011
China: first steal everything you can from your partner, and then start a new company and drive your competitor out of business via labor and environmental arbitrage. Ask the company Fellowes (they make paper shredders) how their joint venture with a Chinese company worked out...

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.