Alibaba has closed the initial repurchase of shares from Yahoo and restructured its relationship with the company in a set of transactions valued at $7.6 billion.

The two companies announced the plan back in May, which would see Yahoo reduce its stake in Alibaba in stages over time, and over a series of agreements. The initial repurchase of shares represented half of Yahoo’s 40% stake in Alibaba, and was valued at about $7.1 billion.

Yahoo got about $6.3 billion in cash and $800 million in preference shares in Alibaba, while Alibaba paid Yahoo a one-time cash payment of $550 million “in connection with the amendment of their existing technology and intellectual property license agreement.”

Under the terms of that agreement, Alibaba has the right to repurchase half of Yahoo’s remaining stake upon a qualifying IPO in the future.

“The completion of this transaction begins a new chapter in our relationship with Yahoo!,” said Alibaba Chairman and CEO Jack Ma. “We are grateful for Yahoo!’s support of our growth over the past seven years, and we are pleased to be able to deliver meaningful returns to our shareholders including Yahoo!. I look forward to working with Marissa Mayer and her team in our continued partnership.”

Alibaba financed the transaction with cash, senior debt and issuance of convertible preference and ordinary shares. According to the company, it’s the biggest private financing for a private sector Chinese company ever. The financing was completed at a valuation of about $40 billion.

Alibaba CFO Joe Tsai said, “Over the past several months we have witnessed significant dislocations in the financial markets driven by global macro events and developments specific to China and the Internet industry. Our ability to raise financing in these difficult market conditions speaks to the strength of our business, our market leadership position and the confidence our investors and financial partners have in the future of Alibaba.”

Yahoo originally acquired its stake in Alibaba in 2005 for $1 billion and sale of its Yahoo China business.