02/14/2012 01:45 pm ET Updated Apr 15, 2012

Yahoo, Alibaba, Softbank Deal Collapses

SAN FRANCISCO (Reuters) - Yahoo Inc was surprised that its Asian partners, China's Alibaba and Japan's Softbank Corp, were walking away from negotiations on a tax-free sale of Yahoo's Asian assets and remained open to talks on other deals, a source told Reuters on Tuesday.

The once-dominant U.S. Internet giant remained open to alternative deal structures, including a taxable transaction, the source added.

Yahoo had not been informed that the original, proposed deal -- a so-called tax-free or cash-rich split-off -- was officially dead, the source said, on condition of anonymity.

(Reporting By Alexei Oreskovic; Editing by Gerald E. McCormick)