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Altaba is the new name for Yahoo's stake in Alibaba and other ancillary holdings, the company announced on Monday.
Verizon agreed to buy Yahoo's core internet business for $4.8 billion in July, but the agreement allowed Yahoo shareholders to keep a group of valuable holdings, including a 35.5 percent stakes in Yahoo Japan, a 15 percent interest in Chinese e-commerce company Alibaba, its cash, convertible notes, certain minority investments, and a noncore portfolio of patents called Excalibur.
That group of holdings will become Altaba after the Verizon deal closes, the company said. Eric Brandt will become chairman of Altaba, and five board members will also remain with the holding company. Yahoo CEO Marissa Mayer will leave Altaba and join Verizon.
The structure of the deal, comprised of Yahoo's "core," and Altaba, previously called the informal "RemainCo," stemmed from a strategy to avoid capital gains tax during a divestiture. Before the Verizon deal, Yahoo had also considered plans to spin off a new public holding company, Aabaco, as a vehicle to distribute shares of Alibaba to shareholders.
To be sure, Verizon's deal to buy Yahoo hasn't closed yet, amid the disclosure of two massive hackings. Still, AOL Chief Executive Tim Armstrong told CNBC last week that he expected the Verizon-Yahoo deal would likely go through.
— CNBC's Tom DiChristopher contributed to this report.