Alibaba Group wants to get $8 billion for shares
Chinese Internet giant Alibaba Group announced the sale of shares in the hope of getting $8 billion for them. Experts assume that this decision was due to the blocking of the IPO of fintech Ant Group, whose main investor is the corporation. The initial public offering of the startup was estimated at $35 billion, but the regulatory authorities blocked the procedure in order to revise the rules for such companies. The new IPO terms for the Internet segment should curb the dramatic dominance of large corporations in the market, and allow small firms to develop.
In addition, the special commission imposed a fine on Alibaba for a number of acquisitions that the holding company carried out several years ago. Supervisory authorities continue to check the Chinese company for the legality of past mergers and acquisitions. The same practice is applied to other Internet giants, which has already caused uncertainty in a number of them.Against this backdrop, Alibaba decided to release its shares on the market. According to a representative of the holding company, this placement is more of an exploratory one, which will allow to find out the interest of investors in the company. Against the background of uncertainty with Ant Group, such a step on the part of the corporation will provide an opportunity to assess the real prospects of business in the market, as well as the mood of potential investors associated with changes in the regulatory framework in China.
The corporation’s IPO was first held in 2014, when the market value of the company was estimated at 231 billion dollars. In 2018, this figure was already $500 billion.
The last time a major issue of Alibaba shares was held in 2019 on the Hong Kong Stock Exchange. At that time, the holding company was able to raise more than $11 billion from Alibaba. In 2020, the company was valued at $90 billion. Last year, sales across all platforms of the Internet giant amounted to about $900 billion.
Alibaba was founded in 1999 by entrepreneur Jack Ma and his partners. Initially, the site was registered, which was a trading platform for small and medium-sized sellers. In the same year, the company managed to raise funds from major investors – financial corporations Goldman Sachs and SoftBank. The first profit appeared in 2002, which allowed further expansion of the portal, connecting new sites and increasing the base of sellers. Now Alibaba is a huge holding company with its payment system Alipay and various directions. Among them are food delivery services, the development of unmanned transport, and artificial intelligence technologies. In 2019, Alibaba’s subsidiary, fintech Ant, acquired the British payment service WorldFirst. The transaction amounted to $700 million.