Internet giant, Yahoo has been able to finalize a long standing deal to sell its 40 per cent stake in the Alibaba Group of China.

Yahoo is looking to pay some of the earnings to its shareholders, who have suffered due to the fall of the company in rennet years. After distribution of the fund among the shareholders, the company might still have about $1.3 billion, allowing new chief executive, Marissa Mayer to investment in acquisitions or hire better talent in her effort to turn around the company.

The deal to sell the state has been finalized four months after Yahoo and the Alibaba Group had announced the details of the financial agreement between the two companies. The deal will offer more autonomy to the Alibaba Group, which is aiming to get listed in the coming year.

Alibaba operates a successful global trade website as well as a number of e-commerce sites. Yahoo will come with a huge profit through this investment, one of the few successes for the company in years. Yahoo had invested $ 1 billion for a 40 per cent stake in Alibaba in 2005 and it will now receive $ 7.1 billion in cash and stock from Alibaba for the stake.

Yahoo will also receive an additional $ 550 million under a revised technology and patent licensing agreement with Alibaba.