News this week: China’s largest
e-commerce company, Alibaba
Group, has reportedly ended talks with regulators and the Hong Kong Stock
Exchange regarding its anticipated initial public offering (IPO). Alibaba has now engaged U.S.-based law
firms to prepare for an IPO in New York instead.
Alibaba’s decision
for a U.S. listing hinged on Hong Kong’s reluctance to accept the company’s
proposal of a dual-class share structure which would enable Alibaba’s
“partners” to retain control over the nomination of a majority of board members
– a popular structure adopted by U.S. technology companies including Facebook
and Google. According to market analysts, the company is estimated to be valued
at up to US$120 billion.
Charles Li, CEO of
Hong Kong Exchanges & Clearing Ltd., was quoted in a blog post without mention of any company names, “We need to look objectively at
the issues and not be swayed by emotional arguments or be distracted by
specific circumstances of any given company or issue. In the end, we should
take responsibility for doing what is right and best for Hong Kong, not just
what is safe and easy.”
This post is excerpted from BSG's weekly e-newsletter
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