Ali Is Still Expected To Win The Largest Listing Financing In History

Here in the world Clothing shoes and hats Alibaba is still expected to win the largest listing and financing in history, according to the editor of www.ali.com.

If Ali underwriters implement the "green shoe option" in the next month, the maximum amount of financing will reach $25 billion, making it the largest IPO ever.

On the 19th, Alibaba successfully landed on the New York Stock Exchange, raising $21.8 billion, making it the largest listing financing in American history. The amount of financing also made Alibaba's listing rank the third in the world, after Agricultural Bank of China and Industrial and Commercial Bank of China. However, some insiders told Tencent Finance that Alibaba is still expected to surpass the amount of listed financing of ICBC and ABC and become the largest IPO in history.

The investment banker, who asked not to be named, said that the above IPO financing amount of $21.8 billion was calculated based on the number of 320 million shares issued. However, if the underwriters of Alibaba decided to implement the "green shoe option" within the next month, the financing amount would reach a maximum of $25 billion, more than the financing amount of $22.1 billion when the Agricultural Bank of China was listed in 2010.

The so-called "green shoe option" refers to a right granted by a listed enterprise to its underwriters, that is, the underwriters have the right to choose to issue a certain proportion of shares more than the scheduled issuance scale within a period of time after the listing of the enterprise.

According to Alibaba's prospectus, Alibaba It plans to issue 320 million shares, of which 123 million are new shares and 197 million are old shareholders, including Yahoo, Ma Yun and Cai Chongxin.

The prospectus specifically points out that the underwriter has the right to issue 15% more shares within 30 days after listing. If the underwriters fully implement, the total number of issued shares will increase by more than 40 million shares to 368 million shares, and the total amount of financing will reach 25 billion dollars based on the issue price of $68 per share.

The above investment bankers told Tencent Finance that the "green shoe option" is usually a mechanism to help listed companies achieve a smooth transition and stabilize stock price fluctuations after entering the secondary market. If the market conditions are good and investors' interest is high, the underwriters may be able to execute the "green shoe option".

Alibaba was sought after by investors on the day of listing, and finally closed at $93.89 per share, up nearly 40%. Scott Cutler, executive vice president in charge of listing business of NYSE, said on the day of Alibaba's listing on the 19th that "Alibaba's' green shoes' will be implemented."

However, some insiders pointed out that whether the underwriters will finally implement this option will also depend on the performance of Alibaba's share price in the next week or two.

Although Alibaba's stock rose well on the day of listing, it also aroused some investors' vigilance that Alibaba's current price might be too high.

New York University Business School finance Professor Aswath Damodaran previously pointed out that Alibaba's potential corporate governance system risks may be a short-term investment suitable for traders, rather than a good long-term investment.

A person who is engaged in angel investment in Silicon Valley said to reporters earlier, "The issue price of $68 is clearly set at a relatively low price. It can also be bought for $80 to $90. I need to consider more than 90."