Alibaba raises 1 billion euros in IPO
Alibaba.com raised 150 billion USD (1.041 billion euros) in the second-biggest initial public offering of an internet company after Google, sources close to the deal told Bloomberg.
Demand for shares in China's largest B2B online site was more than 180 times the number of shares on offer, the sources said. The sources said that 858.9 million shares, making up a 17 percent stake in the company, were sold in Hong Kong for HK$13.50 each, putting the value of the company at 8.8 billion USD (6.11 billion euros).
The sale is the biggest by a Chinese internet company, the Bloomberg report said, coming only second to Google's 1.9 billion USD (1.319 billion euros) in August 2004. Hong Kong individuals ordered about HK$453 billion (40.56 billion euros) worth of stocks, 266 times the amount available to them, the sources said.
International institutions ordered about 160 billion USD (111 billion euros) of shares, more than 190 times the amount available to them after the retail portion was expanded and about 300 million USD (208 million euros) worth of shares reserved for eight corporate investors such as Yahoo and Cisco Systems, Inc, Bloomberg reported.
Jim Oberweiss, president of Oberweiss Asset Management, Inc, told Bloomberg that Alibaba is "among the most interesting issues to come to market in a long time." He cited the Hangzhou-based company's unique market position, exceptional growth opportunities and high barriers to competitive entry.
China is expected to overtake the US next year as the webmarket with the most users and Alibaba's IPO underscores the huge potential for growth in the Chinese market.
Jack Ma, a 43-year old former English teacher, founded Alibaba in his apartment in 1999 with 60,000 USD (41,641 euros). In 2005, Yahoo invested 1 billion USD (694,000 euros) and has a 40 percent stake in the company. Softbank, Japan's third largest mobile-phone carrier, bought a 29.3 percent stake in Alibaba in 2000.
Alibaba.com Lts is scheduled to start trading in Hong Kong on November 6 with Deutsche Bank AG, Goldman Sachs Group Inc and Morgan Stanley arranging the sale.
1 USD = 0,69 euros based on XE.com rates.
