Yahoo unveiled plans for a tax-free spinoff of its remaining holdings in Chinese e-commerce giant Alibaba as the company also reported declines in fourth-quarter earnings and revenue.

But what will Yahoo do with it? In a 2012 sale of Alibaba stock, Yahoo garnered $7 billion, most of which went to buying back the latter's own stock, steadying and bolstering its share price.

Jack Ma, CEO of Chinese Internet giant Alibaba Group, said firms have approached him about a Yahoo deal. Yahoo owns a large stake in Alibaba.

Instead, Yahoo values its Alibaba stake at all but nothing, at least in comparison to what its value may be when the Asian technology giant goes public.

Yahoo needs to figure out what to do with its Alibaba holdings and divest them responsibly.

SAN FRANCISCO - Yahoo (YHOO) is making amends for years of blundering with one smart move: An early investment in China's Alibaba Group (BABA) that has turned into a multibillion-dollar boon.