Alibaba Launches Hong Kong Initial Public Offering: Largest IPO in 2019

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Alibaba Launches Hong Kong Initial Public Offering: Largest IPO in 2019

Chinese e-commerce behemoth, Alibaba IPO in Hong Kong has become the largest IPO in 2019. Alibaba’s annual Singles’ Day global shopping fest saw unprecedented numbers in sales figures, exceeding all its records from previous years by several notches. The plans come against the backdrop of slowing the e-commerce industry in China. The share sale, said to be Hong Kong’s most massive in more than nine years, is a boost for the city

Alibaba IPO

Alibaba Hong Kong IPO listing- Biggest IPO of 2019

Alibaba first went public in September 2014 and chose the New York Stock Exchange for its debut. Primarily, Alibaba is a Chinese multinational company specializing in e-commerce, retail, internet, and technology. The company came under the limelight after releasing the launch of its Hong Kong public retail offering. This offering offers a global reach of  new ordinary shares and listing of its ordinary shares on The Stock Exchange of Hong Kong Ltd. under the stock code “9988”.

Unquestionably, there has already been a lot of fanfare surrounding Alibaba’s IPOs. Alibaba Group beat out Uber’s record of May IPO of $8.1 billion, raising $11.2 billion in a secondary listing. Alibaba’s shares jumped more than 6% when it made its debut on the Hong Kong Stock Exchange and at the market and closed with a 6.6% rise for the day.  Chief executive of the Hong Kong Stock Exchange said, before trading, Alibaba’s listing was a Milestone and like a family member it is finally coming home.

Hong Kong- Alibaba founder Jack Ma’s first choice

Before the company switched to New York,  Hong Kong was Alibaba’s founder Jack Ma’s first choice to list in 2014. After a dispute with HKEx over the selection of board members, the company then shifted to NewYork. Alibaba’s leadership has since repeated its desire to list in Hong Kong eventually.

On Alibaba’s IPO Hong Kong listing, Alibaba’s chief chairman and chief executive, Daniel Zhang, said: “As a result of the continuous innovation and changes to the Hong Kong capital market, we can understand what we regrettably missed out on five years ago.”

Moreover, Alibaba’s first-day rally came amidst economic and political turmoil in Hong Kong. A landslide victory for pro-democracy candidates in local elections on Sunday did not slow down the momentum of the protests.

Launch of Alibaba’s Hong Kong public retail offering 

Alibaba’s annual Singles’ Day global shopping fest saw unprecedented numbers in sales figures, exceeding all its records from previous years by several notches. Subject to the level of any over subscription, the total number of shares available under the public retail offering could be adjusted to up to a maximum of 50,000,000 new shares, representing 10.0% of total shares initially available under the overall Offering.

Alibaba Share Price

Expanding Alibaba’s overall investor base

The listing in Hong Kong will allow more of the company’s users and stakeholders in the Alibaba digital economy across Asia to invest and participate in Alibaba’s growth. In addition to expanding the company’s overall investor base, the Offering will tap into substantial new capital pools in Asia and create a nearly round-the-clock market for global investors to trade Alibaba shares.

With the launch of Alibaba IPO in Hong Kong, the overall investor base will be raised for sure. The offer price for the public retail offering will be no more than HK$188.00 per share. The offer price for the international tranche of the Offering may be set higher than the maximum public retail offer price. Shares will be traded in board lots of 100 shares each.

Alibaba will continue to innovate and invest in the long term. It plans to use the profits from the Offering for the implementation of its strategies like driving user growth and engagement, empowering businesses to facilitate digital transformation. It will also spend more on developing Youku, which Alibaba says is one of the leading online video platforms in China. The company also intends to increase its investment in cloud computing and machine learning, the prospectus shows.

Fully Electronic Application Process for the Public Retail Offering

Alibaba IPO in Hong Kong opts for a fully electronic application process for the public retail Offering. An automated application process is consistent with how Alibaba’s customers and digital economy participants conduct their transactions with each other and Alibaba. The prospectus will be available on the website of the Hong Kong Stock Exchange and on Alibaba’s website.

With no printed prospectuses or application forms, Alibaba, with the aim to last for 102 years, said in a press release that it is focused on the health of the planet. It believes it has a responsibility to minimize its carbon footprint and environmental impact of the Offering. The company claims to have a duty to mitigate its carbon footprint and ecological impact of the Offering.

Potential applicants may call the inquiry hotline of Computer share Hong Kong Investor Services Limited if they have any questions about making applications in the Public Retail Offering.

The launch of Alibaba IPO in Hong Kong encourages applicants for the public retail Offering in Hong Kong to view its prospectus and apply online through the White Form eIPO service or through the CCASS EIPO service, either directly or through their brokers or custodians.

Impact on the Hong Kong Business Environment

It is a significant step to list in Hong Kong at a time when people have lost their confidence in Hong Kong’s market. Also, this Offering is a massive boost for the Hong Kong market that has seen slow business due to the ongoing pro-democracy protests, which have escalated in recent weeks.

How Alibaba’s entering in Hong Kong IPO impacts the Hong Kong Business environment

Based on the pricing, the company will raise as much as HK$101.2 billion (US$13 billion) if the full allocation of 575 million shares is taken up, making it the most significant Offering globally so far.

The size of Alibaba’s Offering will push the local bourse to the top of the global IPO league table in 2019, above the New York Stock Exchange and Nasdaq. The process gives Alibaba’s millions of customers in Asia a chance to own the title of technology champion.

The secondary listing in Hong Kong will be giving the Asian financial center a shot in the arm amid a political crisis and an economic slump. The size of Alibaba’s Offering will push the local bourse to the top of the global IPO league table in 2019, above the New York Stock Exchange and Nasdaq.

The process gives Alibaba’s millions of customers in Asia a chance to own the title of technology champion. Alibaba’s online trading platform has provided retail investors  12.5 million of the 500 million, which is expected to rise to a maximum of 50 million shares.

Conclusion

It is almost certain that the launch of Alibaba IPO in Hong Kong will bring massive changes within the current status of the economy of Hong Kong.  Investors from all over the world already rush to get shares. Among these retail investors are those who are known to have already boosted their companies through over subscription. 

Even though Hong Kong struggles to overcome the most severe political crisis of the decade, it has still showed that this Special Administrative Region is one of the best places to do business.

Alibaba still manages to smash all the records of the previous IPO’s, including Uber, which is one of the reasons Startupr encourages companies to set up startups in Hong Kong.  Also, Hong Kong has a lot of potential in its goal of becoming a new Asian startup hub. For more information about this form, contact Startupr today and invest in your dream project in the freest economy of the World – Hong Kong!

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