Date
25 September 2017
Alibaba Group chairman Jack Ma (left) arrives at the Waldorf Astoria in New York to kick off the international roadshow for the firm's IPO. Photo: Bloomberg
Alibaba Group chairman Jack Ma (left) arrives at the Waldorf Astoria in New York to kick off the international roadshow for the firm's IPO. Photo: Bloomberg

Alibaba to IPO investors: Show me the money (at least HK$8 mln)

Alibaba Group Holding Ltd. is raising the bar for its initial public offering. Only professional investors with assets worth at least HK$8 million (US$1.03 million) and using qualified brokerages need apply.

Phillip Securities Group, a Hong Kong broker that provides subscription services for American IPOs, is charging margin investors 1.5 to 2 percent of shares allotted as commission and 10 percent of the subscribed value as deposit, the Hong Kong Economic Journal, the parent publication of ejinsight.com, reported Wednesday.

Bright Smart Securities and Commodities Group Ltd. (01428.HK) handles American stock transactions but has yet to team up with intermediaries to deal in IPO subscriptions in the US.

It expects only a limited number of investors would participate in the Alibaba IPO because the pricing is not attractive at the higher end of its indicative range.

Broker 8 Securities, however, said it will give out a combined US$1 million to the first 8,888 customers subscribing for Alibaba’s shares on condition that these customers put in at least HK$10,000 into their accounts.

Investors, meanwhile, have found another way to bet on the e-commerce giant — by buying into its shareholders SoftBank Corp., Yahoo Inc. or a special Alibaba fund established by Harvest Capital Management Co. Ltd.

Hangzhou-based Alibaba is seeking as much as US$24.3 billion in its New York IPO which could be the world’s largest.

Market sources said the placing part of the IPO has been oversubscribed more than three times. The number of underwriters has increased to 20 from the original six.

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