Beijing time on the morning of June 1st,

The group announced that it had agreed to purchase its Alibaba stock valued at $2 billion from Softbank group, and that the required funds would be paid by Alibaba's own cash.

In addition, Alibaba partners, composed of Alibaba founders and executives, agreed to subscribe another $400 million of Alibaba shares from Softbank group.

"Under the leadership of Sun Zhengyi, over the past 16 years, Softbank has been a long-term strategic partner highly valued by Alibaba. We look forward to continuing to maintain our close partnership," said Ma Yun, chairman of the board of directors of Alibaba group.

"When Softbank is seeking to improve its earnings, Alibaba believes that by repurchasing our own stocks and investing in our own businesses, it is the best way to make use of our capital and will bring real benefits to our shareholders."

In order to cooperate with the paction,

A convertible convertible bond issued with a total amount of $5 billion will be set up in a new convertible trust fund, which can be converted into common stock of Alibaba group within three years.

The pactions announced by Softbank group aim to reduce the size of its debt and increase its strategic flexibility with cash earned income.

The paction is the first sale of Alibaba by Softbank since its investment in Alibaba in January 2000.

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As of March 31, 2016, Softbank owns 32% of Alibaba's total circulation shares.

After all this paction is completed, Softbank group's Alibaba shares will fall to 28%.