China's largest e-commerce company Alibaba Group has completed the initial repurchase of shares from Yahoo for about $7.6 billion.

The closing follows the May 20, 2012 announcement by Alibaba Group and Yahoo of a plan for Yahoo to reduce its stake in Alibaba Group in stages over time and a series of agreements to implement the restructuring of the ongoing relationship between the two companies.

"The completion of this transaction begins a new chapter in our relationship with Yahoo," Alibaba CEO Jack Ma said.

The initial repurchase of shares, which represented one-half of Yahoo?s 40% stake in Alibaba Group on a fully diluted basis, was valued at approximately US$7.1 billion. Of this, Yahoo received approximately US$6.3 billion in cash and US$800 million in preference shares in Alibaba Group. Concurrent with the initial repurchase, Alibaba Group paid Yahoo a one-time cash payment of US$550 million in connection with the amendment of their existing technology and intellectual property license agreement.

Under the terms of the agreement with Yahoo, Alibaba Group has the right to repurchase one-half of Yahoo's remaining stake upon a qualifying initial public offering in the future. Yahoo originally acquired its stake in Alibaba Group in 2005 in exchange for US$1 billion and sale of its Yahoo! China business to Alibaba Group.