Yahoo Inc. Pares Google Stake, Sells $191 Million in Search Engine Stock

Associated Press

August 28, 2004

NEW YORK (AP) -- Yahoo Inc. said Friday it sold $191 million in Google Inc. stock in that company's initial public offering, cashing out some of the 2.7 million shares Google gave Yahoo this month to settle two disputes.

Yahoo sold 2.3 million of the Class A shares last week at $82.62 apiece. Google shares began trading on Aug. 19, following its IPO.

Yahoo spokesman Ruben Osorio wasn't willing to immediately comment on the stock sale. Google spokesman David Krane declined to comment.

In exchange for giving Yahoo 2.7 million shares on Aug. 9, Google got a perpetual license to Yahoo's patent on matching online advertisements to Web-search results. Yahoo, of Sunnyvale, Calif., also agreed to drop another dispute over warrants to purchase shares that Google granted it under a partnership signed in 2000.

The stock of the Mountain View, Calif.-based Internet search engine finished at $106.15 Friday, down $1.76, or 1.6 percent, on the Nasdaq Stock Market.

Yahoo also converted 1.1 million Class B common shares into a like amount of Class A stock, leaving Yahoo with 1.48 million Class A shares. Yahoo holds Class B stock, which has greater voting power, because it was an early investor in Google.

Yahoo disclosed the information in a filing Friday with the Securities and Exchange Commission. Initially, Yahoo incorrectly reported that Michael J. Callahan, its general counsel, sold 2.3 million Yahoo shares. It later corrected the filing.