Wednesday 13 November 2019 3:38 pm

Alibaba poised to launch record-breaking $13.4bn Hong Kong listing

Alibaba has launched the share sale for its Hong Kong listing, in a $13.4bn (£10.4bn) fundraising effort that’s set to be the biggest cross-border secondary listing ever.

The Chinese online retail giant opened the books for institutional investors looking to buy the shares during trading in New York on Wednesday after winning approval for the fundraising from the Hong Kong Stock Exchange’s (HKEX) listing committee.

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In a 661-page draft prospectus, Alibaba said it plans to use the money raised from its secondary listing to invest in online delivery and local services platform and online travel group Fliggy.

It is also planning to increase its investments in cloud computing and machine learning, according to the prospectus.

Alibaba’s share sale, which is set to be Hong Kong’s largest in nine years, represents a boost for the financial hub, which has fallen into recession after months of political unrest.

The institutional book-building for the listing, which will determine the price the stocks are floated at, is expected to run for a week. The stock is expected to be priced on or around 20 November, according to Reuters.

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It had been reported that Alibaba was hoping to raise between $10bn and $15bn via the listing.

Alibaba, which listed in New York five years ago in a record $25bn float, had initially filed to list in Hong Kong in June with hopes of raising up to $20bn. Plans for the listing then were stalled amid ongoing protests in the city.

Hong Kong has been hit by anti-government protests for five months over what demonstrators regard as increasing Chinese interference in the territory.

Police warned on Wednesday that violence in the city had reached a “very dangerous and even deadly level”, as protestors blockaded several university campuses and disrupted its public transport network.

Citing a source familiar with the deal, Reuters reported that Alibaba is confident it can overcome the negative sentiment in Hong Kong’s stock market, which has been subdued in recent months.

Co-founder Jack Ma said today that Alibaba’s sales from the annual Singles’ Day online shopping festival had missed expectations.

Launched in 2009, the event has become China’s version of the US’ Cyber Monday. The festival is held on 11 November and is also referred to as Double Eleven because of the date.

Read more: Alibaba’s secondary Hong Kong listing gets exchange approval

“This year’s Double Eleven did not meet the expectations I had imagined,” said Ma in a video circulated by Chinese media.

Ma blamed warm weather for helping to put off consumers, Reuters reported. “As soon as the weather gets cold, apparel starts to sell a bit better,” he said.

Main image: Taylor Swift performs at the launch of this year’s Singles’ Day festival (Getty)