Alibaba on record-breaking IPO course

Alibaba on record-breaking IPO course

Alibaba has officially launched on the NYSE with an introductory course of 68 dollars, but its first official course was at 92.7 dollars and immediately shot up to nearly 100 dollars. It has therefore almost become as large as Walmart.

Almost largest retailer in the world?

According to the Wall Street Journal, the real opening price would rise to 91 dollar, meaning the share would have gained almost 36 % even before actual trade began. Alibaba's market value therefore exploded to 230 billion dollars (180 billion euro), which would mean Alibaba just missed out on entering the top ten of companies with the highest market value at the moment.

 

The course rose quickly in the first few minutes and almost reached the 100 dollar mark at 18h Belgian time. That means that Alibaba is able to compete with Walmart, the world's largest retailer, with a 246 billion dollars (191 billion euro) market share.

 

That price was unconfirmed for quite a while, because - due to "disturbingly big volumes" - trade was delayed for a couple of hours. The New York Stock Exchange opens at half past nine local time (15:30 CET), but trade started without the new star share. Two hours later, the investors could revel in the new share.

 

Nearly a record amount

With 68 dollars per share, Alibaba will get 21.8 billion dollars (16.8 billion euro). The company's total evaluation is 168 billion dollars (129 billion euro), which means it is bigger than eBay (145 billion dollars) or Amazon (63 billion dollars).

 

It will not become the largest IPO ever as the Agricultural Bank of China will keep its record of 22.1 billion dollars (17.1 billion euro) from 2012. Alibaba will shatter the record of the largest technological IPO though: Facebook managed to attract 16 billion dollars (12.4 billion euro) in 2012.

 

Yahoo big victor

The largest victor in this IPO is shareholder Yahoo: it controlled 22.6 % of Alibaba prior to the IPO, which will drop down to 16.3 %, but it will get 8.27 billion dollars (6.4 billion euro) for it.

 

Alibaba is an absolute giant, controlling marketplaces like Taobao en Tmall, while it also has 80 % of the Chinese online market in its back pocket. On a yearly basis, Alibaba processes 14.5 billion orders and has 279 million active customers.

 

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