With Alibaba's global roadshow nearing the end of its stage, the company plans to set its initial public offering price at above $70 per share compared to its initial range of $60 to $66. The group will be listing its shares on the NYSE.
Strong demand from global investors prompted China's e-commerce giant to make its decision on this matter. If Alibaba will indeed price this stock at $70, Alibaba will be able to raise $22.5 billion dollars. The company will then be valued at $172.6 billion. The group plans to go global and expand its business to the United States, Europe and Asia.
Sources say that during Alibaba's roadshow in Hong Kong, billionaire founder Jack Ma said that he won't be seeking a high valuation. At the first two days of the order-taking period, there was so much demand from potential investors. If Alibaba will aim for a high valuation before secondary market trading, it might not have much upside after the listing.
Alibaba currently operates several e-commerce platforms including TMall.com and Taobao Marketplace. The group has around $170 billion in sales last 2012, more than eBay and Amazon's sales combined.
Alibaba is currently at its second week of its roadshow and will be focusing on Asia and Europe, followed by its tour in the United States last week. Reports say that Alibaba will stop its order-taking early due to high investor interest.
With enough investor demand, Alibaba might announce a revised price range soon.
Order taking for Alibaba's U.S. based investor will end on September 16 at 4pm. For Asia and Europe, deadline for orders will be on September 17, a day before Alibaba sets the IPO price. Trading will begin on the next banking day.
Participating banks for the group's IPO are Citigroup Inc, Credit Suisse Group AG, Goldman Sachs Group Inc., JP Morgan Chase and Co. and Morgan Stanley.
