HONG KONG (Reuters) – China’s largest e-commerce company Alibaba Group Holding Ltd., has filed confidentially for a Hong Kong listing that could raise up to $20 billion as early as in the third quarter of this year, a person with direct knowledge of the matter said.
FILE PHOTO: A sign of the Alibaba Group is seen at the registered office of the company, in Hangzhou, Zhejiang province, China, July 20, 2018. (REUTERS photo/Aly Song, File/Photo
Be a part of that size would be the largest follow-on to the sale of the shares of the worldwide seven years, and will give Alibaba the funds for the investment in technology is a priority for China as economic growth slows and the trade conflict with the United States has been strengthened.
Alibaba holds the record for the world’s biggest initial public offering with a $25 billion float in New York city about five years ago.
The company had initially hoped to float in Hong Kong, but the tech company’s management structure, and on the way to the city’s listing rules. Hong Kong Exchanges & Clearing, the city’s bourse operator, it changed its listing rules from last year, mainly with the aim of attracting Chinese tech groups.
Alibaba declined to comment on the deal when contacted by Reuters. The japanese SoftBank Group, Alibaba’s largest shareholder with a 28.7% stake, did not immediately respond to a request for comment.
A person with knowledge of the matter, was not authorised to speak to media and so declined to be identified. News of the filing was first reported by the international monetary Fund.
Investment banks China International Capital Corp Ltd Credit Suisse Group AG is leading the deal. The two banks declined to comment. None of the other banks to have a formal contract as of yet.
A BIG DEAL FOR HONG KONG
A list Alibaba in Hong Kong, it will be seen as a victory for the town due to its stock-specific market and industry, which mourned the loss of trading income, if the e-commerce, the group opted to float in New York city.
Trading in Alibaba shares will, on average $2.2 billion per day in the first quarter of this year, according to the Refinitiv of the data, compared with the average daily turnover on the Hong Kong exchange, from $12.9 billion in the same period of time.
Listing in Hong Kong, it would also be mainland Chinese investors their first direct access to one of our country’s greatest success stories, is through the stock connect trading link between Hong Kong, Shanghai, and Shenzhen.
Since its US listing, Alibaba’s market value has almost doubled and is now at $423 billion, the largest in the Asia-Pacific region.
The filing comes in the midst of growing political unrest in Hong Kong this week, raising concerns about the potential impact on the financial markets and businesses.
Thousands of protesters have taken to the streets in the southern Chinese territory this week, with a scheduled delivery arrangement with the mainland of China.
Logistics real estate developer ESA Cayman Ltd., on Thursday, pulled up to what would be the largest Hong Kong listing so far this year, citing “current market conditions”.
So far this year, with the benchmark Hang Seng index has gained 5.6%, compared with a 22.4% jump in China’s blue-chip CSI 300, and a 14.9% rise in the U.S. S&P 500.
Reporting by Julie Zhu in Hong Kong; Additional reporting by Sam Nussey, in Tokyo, and a Mekhla Raina in Bengaluru; Writing by Alex Hughes; Editing by Christopher Cushing and Muralikumar Anantharaman