Alibaba upcoming IPO still on track despite film unit's accounting issues
Potential irregularities at recently bought Alibaba Pictures unlikely to affect e-commerce firm's US listing as it vows to support film arm
The suspension of Hong Kong-listed Alibaba Pictures from trading yesterday after management discovered possible financial records breaches will have no impact on its parent's plans for a heavyweight public offering in the United States, sources said.
But Chan Kar-lok, director of asset manager Essence International, said management should straighten out financial accounting and give a clear explanation to the public as soon as possible, warning that "otherwise it may hit the confidence of investors".
He doubted it would have any serious impact though, saying "the problem is at a subsidiary, not Alibaba Group".
"Alibaba has bought so many companies this year and there might be some problems technically, which they should solve as quick as quick can be," he said.
Alibaba has embarked on a series of acquisitions this year as the mainland e-commerce giant heads towards what could be the biggest ever initial public offering in the US.
Often as an IPO date gets nearer, key issues do surface
It has spent about 40 billion yuan (HK$50.2 billion) on mergers and acquisitions so far this year, either through Alibaba Group or through other entities controlled by founder and chairman Jack Ma Yun.