This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

China's Alibaba Geared Up for U.S. IPO

Stocks in this article: SINA YHOO AMZN EBAY

By Kelvin Chan

HONG KONG -- Chinese e-commerce giant Alibaba Group said Sunday that it will go public on a U.S. stock exchange in a move analysts say might raise up to $15 billion in the year's biggest initial public offering.

(See more of TheStreet's coverage of the Alibaba IPO here: "Bull vs. Bear on the Upcoming Alibaba IPO.")

The announcement ended months of speculation over where the company would list its shares, after talks for a Hong Kong stock sale fell apart last year.

Alibaba is one of the world's biggest Internet companies and says more than $150 billion worth of merchandise changes hands on its online platforms each year, more than Amazon (AMZN) and eBay (EBAY) combined.

The company began as a service to link Chinese suppliers with retailers abroad and has branched out into retail e-commerce. It is little known abroad but has launched two consumer-oriented services in the United States.

"Alibaba Group has decided to commence the process of an initial public offering in the United States," the company said in a statement. "This will make us a more global company and enhance the company's transparency, as well as allow the company to continue to pursue our long-term vision and ideals."

It gave no details of the timing or size of the initial public offering or on which exchange it would take place.

Analysts have estimated that an Alibaba IPO could raise up to $15 billion and value the company at more than $100 billion.

Alibaba, based in Hangzhou, had previously abandoned plans for an IPO in Hong Kong because the semiautonomous Chinese financial center's stock exchange refused to change its rules to accommodate the company's unusual management structure.

The company failed to persuade the Hong Kong exchange to grant it an exception from listing rules so that it could maintain a "partnership" structure that lets top executives, who own 10% of the company, retain control of the board.

The company hinted that the door has not completely shut on listing its stock in Hong Kong.

"Should circumstances permit in the future, we will be constructive toward extending our public status in the China capital market in order to share our growth with the people of China," the statement said.

Alibaba is one of a number of Chinese Internet heavyweights planning to cash in with IPOs amid rapid growth. The announcement comes two days after the Weibo microblog unit of Chinese Internet company Sina's  (SINA - Get Report)  filed plans for a potential U.S. IPO. Weibo, China's equivalent of Twitter, indicates it plans to raise $500 million. Another Chinese online retailing giant, JD.com, filed in January for a U.S. stock listing.

Alibaba Group doesn't report its finances. But Yahoo, (YHOO - Get Report) which owns a 24% stake in the company, said Alibaba's revenue for the quarter ending in September rose 51% from a year earlier to $1.8 billion.

That was down from 61% growth over a year earlier in the previous quarter and 71% in the first quarter of 2013.

Copyright 2014 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,191.37 -195.84 -1.13%
S&P 500 2,002.16 -27.39 -1.35%
NASDAQ 4,637.9940 -43.5030 -0.93%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs