Yahoo Inc said on Tuesday it would buy back up to US$3 billion shares through a tender offer to provide liquidity to stockholders looking to sell the stock ahead of the company's pending deal with Verizon Communications Inc.

Shares in Yahoo (YHOO.O), which has a 15 per cent stake in Chinese e-commerce company Alibaba Group Holding Ltd, were up two per cent at $50.81.

Yahoo said it would determine a single purchase price after the expiry of the Dutch auction tender offer on June 13 and that the price would not be less than US$37 per share.

The company said its directors and executive officers will not tender any shares in the buyback.

Verizon (VZ.N) agreed to buy Yahoo's core internet properties last year for US$4.83 billion in cash. It lowered the original offer by US$350 million in February following two massive cyber attacks at the internet company.

After the Verizon deal, Yahoo will be renamed Altaba, a holding company whose primary assets will be its stake in Alibaba and a 35.5 per cent stake in Yahoo Japan.