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A Yahoo! billboard is seen in New York's Times Square in 2010.

Brendan McDermid/REUTERS

Yahoo Inc. may re-evaluate plans for the cash it gets from a multibillion-dollar sale of half of its 40 per cent stake in Chinese Internet company Alibaba Group.

Shares of Yahoo fell 4.4 per cent to $15.30 (U.S.) in after-hours trading on Thursday.

Yahoo, which hired new chief executive officer Marissa Mayer last month, said in a filing with the U.S. Securities and Exchange Commission on Thursday that Ms. Mayer has started a review of the company's strategy.

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The filing said the review "may lead to a re-evaluation" of Yahoo's previously announced plans to return to shareholders substantially all of the after-tax cash proceeds under the initial share repurchase from the May 2012 deal with Alibaba.

Under the agreement, Yahoo was to sell one-half of its stake in Alibaba for at least $6.3-billion in cash and up to $800-million in new Alibaba preferred stock.

"There was an expectation of getting that cash back, so I think there will definitely be some disappointment," said RBC Capital Markets analyst Andre Sequin.

But he said that shareholders also expect Ms. Mayer, a former Google executive, to re-invest in the company's domestic business to rejuvenate the struggling web company.

As part of Ms. Mayer's review, Yahoo said, she would look at the company's growth and acquisition strategy, the restructuring plan launched by her predecessor, and Yahoo's cash and capital allocation strategy.

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