Alibaba Group is close to raising $8 billion as part of an investment goal to reduce Yahoo!’s equity in the company. The fund is being raised from hedge funds, mutual funds, and private equity firms.
The company is selling preferred and common shares in the transactions along with borrow about $4 billion. Alibaba and Yahoo! entered an agreement this past May, which prompted their latest funding round.
Yahoo! would cash in 20% of their 40% stake in Alibaba for $7 billion. The remaining stake would be sold off in an Alibaba IPO. Alibaba is working on raising the cash for the first part of the agreement.
Yahoo! interim CEO Ross Levinsohn agreed to that deal back in May. Yahoo!’s 20% is expected to be repurchased in the fourth quarter.