The company that has been dubbed the Yahoo of finance will pay $1.9 billion to US shareholders to settle an initial public offering that sparked a fierce battle between investors and regulators.
The deal, expected to close in the second quarter, is one of the biggest ever in the sector.
Yahoo has already sold off billions of dollars worth of its stock to foreign governments and companies.
Yahoo Finance is the latest in a string of private companies to be rocked by public and government probes in recent years.
The US Securities and Exchange Commission (SEC) has been investigating the company for months over allegations of misleading investors.
The European Union is also probing Yahoo’s financial practices.
The company has not yet announced a final valuation.
The $4 billion payment will be paid in a lump sum over five years, with the funds used to fund Yahoo’s restructuring and buyback program.
The money will be divided into three pools, with one being used for Yahoo Finance, the other being used to pay back the investors who bought into the company, and the third for future investment.
Yahoo’s current $8 billion market cap is $2.4 trillion.
The sale of Yahoo is the second big transaction for the US market leader in recent weeks.
In February, Microsoft sold its stake in the firm for $8.2 billion to private investors, bringing its total value to $22.4bn.