Alibaba ready to launch IPO

Records

Alibaba’s shares will be offered at a price of 60 to 66 dollars (46 to 51 euro) with the aim of gathering 21.1 billion dollars (16.3 billion euro). That would give it the largest IPO ever for a technology company, beating the previous record set by Facebook in 2012 when it managed a 16 billion dollar (12.5 billion euro) opening.

Even Agricultural Bank of China‘s absolute record-breaking opening might be broken: it managed 22.1 billion dollars (17.1 billion euro) in 2010. If Alibaba decided to hand out more shares or to increase its price range, then it might be able to break that record as well.

No direct shareholders

Alibaba will definitely become one of the largest technology companies on Wall Street with a 160 billion dollar (123.7 billion euro) market value. That would mean it is bigger than Amazon.com, even though Google and Facebook would still be out of reach.

Future Alibaba shareholders will have to rely entirely on founder Jack Ma and his associate Simon Xie’s judgment as the shares are actually part of a company in the Cayman Islands. That particular company owns Alibaba’s subsidiaries – through several workarounds and it is for this company that people can buy shares. The Chinese government also does not allow foreign shareholders for Alipay, Alibaba’s payment service, which has forced Alibaba to place that particular service in another company. That also means that shareholders cannot benefit from any profits Alipay brings in.