Alibaba drops share sale to revive hopes of a Hong Kong listing
The online giant drops plans to list elsewhere to allow heat over its proposed structure to cool while the HKEx chief takes a sympathetic stance
Chinese e-commerce giant Alibaba has abandoned plans to sell shares anywhere in the near term in a bid to let the heat die down over its controversial share-structure proposal, chief executive Jonathan Lu Zhaoxi told the South China Morning Post yesterday, leaving the door open to a Hong Kong listing.
"We decided to put down the issue after the last round of discussions," Lu said in an interview at the company's Hangzhou headquarters.
"Hong Kong may need some time to understand the creative management structure for a creative company," he added, in a sign that the potential HK$100 billion share deal has not yet been permanently lost to the city in favour of an alternative listing venue.
We decided to put down the issue after the last round of discussions
There appears to be movement on the Hong Kong side too, with Hong Kong Exchanges and Clearing chief executive Charles Li Xiaojia saying in his blog yesterday that consideration should be given to "non-standard shareholding structures" for "innovative companies".
In his blog on HKEx's website, Li said there were "a wide range of possibilities that could be considered" when deciding whether or not to let innovative firms' founders have extra power to influence the nomination of the majority of board members.
Proponents of the structure have argued that such an arrangement would preserve the long-term vision, ideas and strategies of company founders - many of whom would have seen their interests diluted after rounds of external financing.
But opponents said this could open the door for the largest shareholders to harm minority shareholders' interests when their interests were not aligned.