Alibaba Group Holding Ltd (NYSE:BABA) plans to initiate its listing in Hong Kong this November. Alibaba aims at raising approximately $15 billion from this listing. This comes after its plans to actualize the listing were derailed by political instability early this year.
The listing of Alibaba in Hong Kong will not only boost the company’s capital but also raise Hong Kong’s status to a major capital market center. The Hong Kong capital market led the global rankings on IPOs funds in 2018. However, this year, due to pro-democracy unrest and collision with the authorities, it came behind NASDAQ and NYSE.
Alibaba’s listing will be the year’s largest equity deal. This, however, will happen in Saudi Aramco, a state-owned oil company, delays its initial public offering to next year. Saudi Aramco’s IPO is approximately valued at over $20 billion.
Alibaba, the renowned global E-commerce giant, plan is to seek approval for the listing from Hong Kong Exchanges and Clearing Ltd on November 11, the company’s Singles Day, and then list the shares towards the end of November or latest early December.
This move by Alibaba could shake up the liquidity of Hong Kong’s financial system. This is because most investors tend to buy funds when such a large share sale is upcoming. This will trickle down to the Hong Kong Interbank Offered Rate (HIBOR).
Alibaba’s move comes after AB InBev (ABI.BR) raised approximately $5 billion after the listing of its Asia-Pacific unit in Hong Kong Exchange in September. AB InBev listing was the second-largest IPO and bourse’s biggest this year. If Alibaba goes through with its plan, it will top the list.
Reuters reported that Alibaba hopes to forego the pre-marketing meetings that involve institutional investors. This is given the size of the equity deal as well as its reputation amongst many investors across the globe. The company can easily leverage its goodwill and global status for a smooth listing of its shares. Alibaba targets to raise between $10 to $15 billion through this Hong Kong Exchange listing.
