14 DAY TRIAL // Alibaba’s IPO is officially the world’s largest in history as the value was pushed to $25 billion (€19.44 billion) after the e-commerce giant and some of the shareholders decided to sell additional shares.
The huge demand initially pushed the IPO to $21.8 billion (€16.95 billion). Following the stock’s surge by 38 percent in the Friday debut at the New York Stock Exchange, however, underwriters exercised an option to sell an additional 48 million shares, Reuters reports.
26.1 million of these shares were sold by Alibaba, while another 18.3 million came from Yahoo. This brought the companies an extra $1.8 billion (€1.4 billion) and $1.2 billion (933 million) respectively.
Jack Ma, the companies executive chairman and one of the founders, has decided to sell an additional 2.7 million shares, while Joe Tsai, co-founder, sold an extra 902,728 shares, the prospectus shows.
This means that Alibaba’s initial public offering is officially the largest in history, bypassing even the one set by the Agricultural Bank of China Ltd back in 2010, when the bank raised $22.1 billion (€17.18 billion).
The company declined to comment the information which came from a source that desired to keep its anonymity because details of the additional sale have yet to be made public.
Alibaba, the biggest ecommerce company in China
Alibaba is an ecommerce giant that originates from China. The company was founded in 1999 and has since managed to become the largest company of its kind in China. While Alibaba’s main business is centered around ecommerce, such as Taobao and Tmall, there are plenty of other areas where it operates. There is, for instance, a cloud computing service, or an online payment platform with no transaction fees, called Alipay.
Alibaba’s websites account for an estimated 80 percent of China’s online sales, while Alipay is used for half of all online payment transactions in the country.
According to Alexa’s site ranking system, Alibaba.com ranks 63 at a global level, Taobao.com ranks 10th, Tmall.com ranks 18th and Alipay is on the 109th spot.
The company is big enough that it has high chances of striking gold in other countries too. In the United States, for instance, it would be a serious competitor for the likes of Amazon and eBay. Even if it were to take years for Alibaba’s brands to become a big part of the US ecommerce playground, it could still pose a serious threat to its competitors.