Yahoo 2005 Annual Report Download - page 102

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96
Note 16 RELATED PARTY TRANSACTIONS
The Company and other third parties are limited partners in Softbank Capital Partners LP (“Softbank
Capital”), a venture capital fund which is an affiliate of SOFTBANK. A Managing Partner of Softbank
Capital is also a member of the Company’s Board of Directors. The total investment by the Company in
Softbank Capital is approximately $36 million and represents less than a 5 percent holding in Softbank
Capital. A significant portion of this investment has been impaired by the Company, with the remaining
value included on the consolidated balance sheets in other assets. Pursuant to the Partnership Agreement,
the Company invested on the same terms and on the same basis as all other limited partners.
Revenue from related parties, excluding Yahoo! Japan, represented no more than 1 percent of the total
revenue in the years ended December 31, 2003, 2004, and 2005. Management believes that prices on
agreements with related parties were comparable to those with other similarly situated customers of the
Company.
See Note 4 — “Investments in Equity Interests” for additional information related to transactions
involving Yahoo! Japan.
Note 17 SUBSEQUENT EVENTS
Joint Venture with Seven Networks Limited. On January 29, 2006, the Company and Seven Network
Limited (“Seven”), a leading Australian media company, completed a strategic partnership in which the
Company contributed its Australian Internet business, Yahoo! Australia and New Zealand, and Seven
contributed its online assets, television and magazine content, an option to purchase its 33 percent
ownership interest in mobile solutions provider m.Net Corporation Ltd, and cash of AUD $10 million
(approximately $7 million). The Company has a 50 percent equity ownership interest in the newly formed
entity, which will operate as “Yahoo!7.” Pursuant to a shareholders agreement and a power of attorney
granted by Seven to vote certain of its shares, the Company has the right to vote 50.1 percent of the
outstanding voting interests in Yahoo!7 and control over the day-to-day operations and will therefore
consolidate Yahoo!7’s results.
Structured Stock Repurchase. Subsequent to December 31, 2005, the Company received $272 million in
cash from the settlement of a structured stock repurchase transaction of $250 million entered into in
July 2005 and 3 million shares at an average price of $36.60 per share from a $110 million transaction
entered into in November 2005. Additionally, subsequent to December 31, 2005, the Company entered
into $250 million in structured stock repurchase transactions in tranches of $50 million and $200 million
which will mature in July 2006. On the maturity dates if the market price of Yahoo! common stock is at or
above $34.50 for the $200 million tranche and $33.90 for the $50 million tranche, the Company will have its
investment returned with a premium, otherwise the Company will repurchase up to an aggregate of 8
million shares.
Stock Repurchase Transactions. Subsequent to December 31, 2005, the Company repurchased
19 million shares of its common stock under the current stock repurchase program at an average price of
$33.51 per share, for a total amount of $639 million.