Alibaba Group wins approval for mega Hong Kong listing

Hong Kong, China - Alibaba Group Holding Ltd plans to offer about 500mn shares in its Hong Kong listing, a person with knowledge of the matter said, setting the tech giant up to potentially raise more than US$11bn.

The base offering could raise US$11.7bn based on Alibaba’s last close in New York, though it wasn’t clear if the company would market the deal at a discount to its US stock price. Alibaba confirmed on Wednesday it had filed a listing application with the Hong Kong exchange. Alibaba’s American depositary shares, which represent eight ordinary shares of the internet company, rose 0.1 per cent to US$186.97 in US trading on Tuesday.

The deal underwriters would also have a so-called greenshoe option to sell an additional 75mn shares, according to the person, who asked not to be identified because the information is private. Terms of the share sale haven’t been finalised and could still change before the offering launches, the person said.

Alibaba declined to comment in an emailed statement.

The Hong Kong stock exchange approved the Internet company’s listing application, a person with knowledge of the matter said earlier on Wednesday. Asia’s largest corporation is proceeding with what could be this year’s largest stock offering despite violent pro-democracy protests gripping the city. The Chinese e-commerce titan is aiming to raise as much as US$15bn in the financial hub’s largest issuance of stock since 2010, Bloomberg News reported last week.

Alibaba’s share sale marks a triumph for Hong Kong stock exchange that lost many of China’s brightest technology stars to US rivals. The city’s bourse has introduced new rules that allow dual-class shares after resisting such a change for a decade. Efforts to lure Alibaba went all the way to the top of Hong Kong’s government, with chief executive Carrie Lam exhorting billionaire Jack Ma to consider a listing in the city.