E-Commerce Company Abandons Plan to Launch IPO Listing in Hong Kong
The largest e-commerce company in China has abandoned their plans of launch its initial public offering in Hong Kong. Alibaba Group Holdings chief executive officer Jonathan Lu said in s statement that the company decided not to release its listing in Hong Kong saying that Hong Kong authorities still need time to digest and study the innovative corporate structures of knowledge based companies.
Although the company announced its dropping out of the listing and ruling out the Hong Kong stock exchange, the company will not end the rumors on the choice of a listing venue. Aside from Hong Kong and the United States there are rumors that the company might launch their IPO in Shanghai. Furthermore the company has yet to decide on its IPO timetable.
With most of its business in China, Alibaba looked at Hong Kong as its first choice for its IPO listing, but the two sides could not reach a decision on the company’s unique shareholding structure especially the fact that its 28 partners mainly senior executives and its founders are making all the operating decisions even with the fact that they only own 13 percent of the company and the Hong Kong stock exchange was insisting on equal treatment on its shareholders.
Alibaba’s IPO listing is a very high profile deal in which financial analysts estimated that the company can reach US$ 15 billion the biggest debut of a technology company globally after Facebook. Analysts are also saying that Hong Kong’s IPO market could go into virtual hibernation after Alibaba dropped their listing and other analysts agree saying that the Hong Kong IPO market have seen fewer business conglomerates listing and predicted that Hong Kong might not retain its top three position in 2013 in terms of fund raising.