HONG KONG, China — Alibaba Holdings Inc is in talks with major shareholders to reclaim a stake in fast-growing online-payments affiliate Alipay, The Wall Street Journal reported on Wednesday, citing people familiar with the matter.

The discussions revolve around several options, among which is the purchase by Alibaba of one-third of Alipay, the Journal said, citing one of the unidentified people.

Even if an agreement were to be reached, it would not be expected to take effect before Alibaba's expected U.S. initial public offering, and it would face regulatory review in China, according the people quoted in the report.

Alibaba, the world's biggest e-commerce company, was not available for comment outside normal business hours.

The Chinese company is now preparing for what could be the largest tech company IPO in history, a U.S. offering that is not expected to include assets related to Alipay. But the prospect of the company reclaiming a slice of its former unit could boost sentiment around its debut.

Like eBay Inc's PayPal, Alipay plays a key role in processing payments across Alibaba's vast online network. It is estimated to handle half of China's online payments and was considered one of Alibaba's more valuable assets before it was spun out of the company in 2011.

That decision prompted objections from Yahoo Inc, which still owns 24 percent of Alibaba, and other investors who accused the Chinese company of surrendering a strategically important asset without prior notice. The companies eventually agreed to accept compensation for the asset.

Alibaba has said the spinoff decision was taken to comply with Chinese regulations governing third-party payments services. Alipay's holding company also offers access to about $87 billion of assets under management, and has interests in insurance and micro-finance.

By Aman Shah; Editors: Steve Orlofsky and Leslie Adler

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