Friday, May 09, 2014

Alibaba Group files U.S. IPO documents

News this week: China’s largest e-commerce company, the Alibaba Group, has filed documents in the U.S. for its much anticipated initial public offering (IPO). The company has yet to decide on whether to list on the New York Stock Exchange or NASDAQ. The IPO will be underwritten by Credit Suisse, Deutsche Bank, Goldman Sachs, JP Morgan, Morgan Stanley and Citigroup.

Alibaba’s co-founder Jack Ma now reportedly owns 8.9% of the company, with major shareholders Yahoo Inc and Softbank owning 22.6% and 34.4% respectively. As part of an earlier agreement, Yahoo must sell around 40% of its stake in Alibaba through the IPO or directly back to Alibaba prior to the IPO.

Alibaba will reportedly be governed by a partnership consisting of 28 members with exclusive right to nominate a majority of its board of directors. Yahoo will resign its seat on the board upon the listing, and Softbank will have the right to nominate one director to a new nine-member board. According to Alibaba’s filing with the U.S. Securities and Exchange Commission, the company’s IPO will offer the public a 12% stake worth approximately US$20 billion based on estimated values.

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