Friday, September 27, 2013

Alibaba reportedly taking IPO to New York

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 which is part of our subscription research service, BSG Tracker. Visit our website to find out more about this service. You can also follow us on Twitter for all the latest updates.

No comments: