Alibaba poised to launch a record $13.4 billion HK share sale: sources

HONG KONG (Reuters) – Chinese e-commerce giant Alibaba Group is ready for the launch of a Hong Kong share sale expected to raise up to $13.4 billion as soon as Thursday, according to two sources with knowledge of the discussions.

FILE PHOTO: the logo of Alibaba Group is seen at the World Internet Conference (WIC) in Wuzhen, Zhejiang province, China, on Oct. 20, 2019. (REUTERS photo/Aly Song, File/Photo

As Alibaba executives are preparing for a Thursday launch, the sources said that the timing could slip, depending on the developments in Hong Kong’s ongoing protests.

The sources declined to be named because the information is not open to the public.

An Alibaba spokesman declined to comment on the company’s listing plans.

The deal is the largest cross-border secondary advertisement can be seen as a boost for the Hong Kong, who had recently its first recession in a decade, with more than five months of street protests and concerns about the US-China trade war took its toll.

The company intends to use the sale of the shares earlier in the year, but in August, have postponed the deal as protests rock Hong Kong in June, it was becoming increasingly more violent.

Another source with knowledge of the tender process, said Alibaba was confident the company could overcome the negative perception created in the Hong Kong financial markets in the wake of the ongoing protests.

The deal was originally expected to raise up to $15 billion, the source said that the company could sell up to 500 million of primary shares at the price. Included in a typical “greenshoe”, or overallotment option, to sell some additional shares, the sale could raise up to $13.4 billion.

A sale of that size, it will dilute the existing shareholders by 2.8%, and an investor may trade shares between the two stock markets, the source said.

Alibaba will lodge in the US, applications for the approval and publication of a preliminary prospectus for the deal on Wednesday evening to the Hong Kong Stock Exchange’s website.

Report by Scott Murdoch; Writing by Alex Hughes; Editing by Carmel Crimmins, Christopher Cushing and Louise Heavens

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