The board of directors of Yahoo approved an additional stock buyback worth $2 billion based on its Form 8-K filing with the Securities and Exchange Commission (SEC).

According to the Yahoo, the $2 billion stock buyback is in addition to the $726 million remaining amount under its existing shares repurchase program, which will expire on December 2016. The newly approved share repurchase program will expire on March 31, 2018.

Yahoo indicated in its regulatory filing that it would repurchase its stock in the open market or through privately negotiated transactions including without limitation, accelerated share repurchase transactions, derivative transactions, and under Rule 10b5-1 plans.

Yahoo! Inc. Board Approves $2 Billion Stock Buyback

Starboard urges Yahoo to repurchase $4 billion shares

Yahoo is expected to use the proceeds from the initial public offering (IPO) of Alibaba Group Holding last year.  The search company sold $9.4 billion of its stake in Alibaba. It still owns 15% stake in the Chinese e-commerce giant.

Last January, the search company announced a tax-free spinoff of its remaining stake in Alibaba into an independent registered investment company. Yahoo CEO Marissa Mayer said the spinoff will maximize the value for shareholders.  The decision came after Starboard Value threatened to push for leadership change in the company.

Earlier this month, Starboard Value emphasized that Yahoo is sitting on $5.4 billion in net cash, and demanded the search company to repurchase as much as $4 billion shares.

The activist investor also urged the company to separate its stake in Yahoo Japan in a tax-efficient manner and to implement aggressive cost cutting measures. Starboard Value believed that Yahoo can cut costs between $330 million and $570 million per year.

Starboard Value said, “Yahoo is in need of a major overhaul.” The activist investor explained that its recommendations could help Yahoo unlock $11.1 billion of shareholder value or $11.70 per share.

Yahoo stock performance

The shares of Yahoo are trading are trading around $45.18 per share, up by 1.64% at the time of this writing, around 2:15 in the afternoon in New York. The company has approximately $41.6 billion market capitalization.

Over the past 52-weeks, the shares of the company traded between $32.15 and $52.62 per share. The company lost more than 10% of its stock value year-to-date.