Introduction
On September 19, 2014, the Chinese e-commerce giant Alibaba Group Holding Limited (Alibaba Group), had an initial public offering of American depository shares at $68 per share on the New York Stock Exchange.
This deal raised $25 billion for Alibaba Group, making it the world’s largest IPO.
The listing ensured Alibaba surpass a previous global record set by Agricultural Bank of China in 2010, and also made Alibaba one of the most valuable technological companies, comparable to the likes of Google, Microsoft, Facebook, etc.
Alibaba Group mentioned in their SEC fillings to use the net proceeds they will receive from the offering for general corporate purposes.
Alibaba’s business verticals
• Taobao Marketplace: It is China’s most …show more content…
2008: Alibaba Group founds a platform for third-party brands and retailers (Tmall.com)
2010: The Alibaba Partnership structure is established. It launches the Mobile Taobao app.
2012: Alibaba.com is delisted from the Hong Kong Stock Exchange at a delisting price of HK$13.50 in order to run free from the pressure of market expectations, earnings visibility and share price fluctuations.
2013: Due to disagreement over shareholder rights, Alibaba Group abandons its plan to list on the Hong Kong Stock Exchange
2014: Alibaba Group lists on the New York Stock Exchange.
Further Deal Details
Following is the snapshot of the filing terms and shares offered
Source: Bloomberg
Following is the list of underwriters involved in the listing and the fee charged. Source: Bloomberg
Following is the list of selling shareholders Source: Bloomberg
Unique characteristics of Alibaba IPO
1. Alibaba did not list on Hong Kong Stock Exchange
Alibaba pursued a New York IPO because of Hong Kong Stock Exchange’s refusal to grant Alibaba an exemption to its strict listing …show more content…
Listing of companies with such structures is not allowed by HKSE.
This kind of a structure was originally designed to let a group of 27 managers to stay in control. Thus, the group would have the right to name the majority of Alibaba’s directors, in turn giving them effective control of the board and of the company’s strategic direction. Therefore, Alibaba’s partnership structure, like a DCS structure, gives some shareholders more voting rights than others, and hence gives the company’s founders to maintain control and power.
Even after a green signal was given to Alibaba by US, its founders were still keen to wait and negotiate with the HKSE. HKSE too, discussed the possibility of alternative share and control structures on a market-wide consultation because HKSE wanted to remain competitive as a listing venue.
Therefore, in August 2014, a ‘concept paper’ was released by HKSE to gauge market support for regulatory changes which would allow companies with such structures to list on the exchange. Hence, HKSE was pondering upon the changes in regulations.
However, the consultation came too late and Alibaba had chosen NYSE to
On September 19, 2014, the Chinese e-commerce giant Alibaba Group Holding Limited (Alibaba Group), had an initial public offering of American depository shares at $68 per share on the New York Stock Exchange.
This deal raised $25 billion for Alibaba Group, making it the world’s largest IPO.
The listing ensured Alibaba surpass a previous global record set by Agricultural Bank of China in 2010, and also made Alibaba one of the most valuable technological companies, comparable to the likes of Google, Microsoft, Facebook, etc.
Alibaba Group mentioned in their SEC fillings to use the net proceeds they will receive from the offering for general corporate purposes.
Alibaba’s business verticals
• Taobao Marketplace: It is China’s most …show more content…
2008: Alibaba Group founds a platform for third-party brands and retailers (Tmall.com)
2010: The Alibaba Partnership structure is established. It launches the Mobile Taobao app.
2012: Alibaba.com is delisted from the Hong Kong Stock Exchange at a delisting price of HK$13.50 in order to run free from the pressure of market expectations, earnings visibility and share price fluctuations.
2013: Due to disagreement over shareholder rights, Alibaba Group abandons its plan to list on the Hong Kong Stock Exchange
2014: Alibaba Group lists on the New York Stock Exchange.
Further Deal Details
Following is the snapshot of the filing terms and shares offered
Source: Bloomberg
Following is the list of underwriters involved in the listing and the fee charged. Source: Bloomberg
Following is the list of selling shareholders Source: Bloomberg
Unique characteristics of Alibaba IPO
1. Alibaba did not list on Hong Kong Stock Exchange
Alibaba pursued a New York IPO because of Hong Kong Stock Exchange’s refusal to grant Alibaba an exemption to its strict listing …show more content…
Listing of companies with such structures is not allowed by HKSE.
This kind of a structure was originally designed to let a group of 27 managers to stay in control. Thus, the group would have the right to name the majority of Alibaba’s directors, in turn giving them effective control of the board and of the company’s strategic direction. Therefore, Alibaba’s partnership structure, like a DCS structure, gives some shareholders more voting rights than others, and hence gives the company’s founders to maintain control and power.
Even after a green signal was given to Alibaba by US, its founders were still keen to wait and negotiate with the HKSE. HKSE too, discussed the possibility of alternative share and control structures on a market-wide consultation because HKSE wanted to remain competitive as a listing venue.
Therefore, in August 2014, a ‘concept paper’ was released by HKSE to gauge market support for regulatory changes which would allow companies with such structures to list on the exchange. Hence, HKSE was pondering upon the changes in regulations.
However, the consultation came too late and Alibaba had chosen NYSE to