Alibaba.com, China’s leading e-commerce company, will go public later this year in what could be the biggest initial public offering ever for a Chinese Internet company.
Alibaba.com is controlled by the Alibaba Group and partly owned by Yahoo. An IPO could raise $1 billion. That would be bigger than either Baidu.com or Tencent.com, which runs the popular QQ instant messaging service. A formidable trio.
Three Wall Street investment banks, Goldman Sachs, Morgan Stanley and Deutsche Bank, are advising Alibaba on the public offering which will be pushing the business-to-business site and back office that runs it. Alibaba.com helps entrepreneurs, suppliers and businesses from around the world find one another and buy and sell goods.
In 2005, Yahoo paid $1 billion in cash for a 40% share of Alibaba and handed its China operations over to the Alibaba Group and its chairman and chief executive, Jack Ma, a former English teacher from Hangzhou, where Alibaba is based. Above he gives it the thumbs up. At that time, the Alibaba Group was valued at about $4 billion.
Now, people who have been briefed on the public offering say that Alibaba.com alone could be valued at more than $4 billion when it goes public. Other divisions of the Alibaba Group, like its online marketplace, Taobao.com, and the Yahoo China operations, will not be included in the stock offering. Those units will remain part of the privately controlled Alibaba Group. Which means Yahoo made a very fair buy.
No one is officially confirming the IPO but it is a lot more than a rumor. It will happen. The only question is the precise date.
Source: New York Times
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