Ex-Rothschild banker faces Alibaba IPO test

PUBLISHED : Thursday, 01 May, 2014, 1:27am
UPDATED : Thursday, 01 May, 2014, 1:27am

As prepared for its Hong Kong initial public offering in late 2007, details of the deal emerged in local media, much to the frustration of Michael Yao, the company's top financial adviser.

Yao, then at Rothschild, summoned bankers and others working on the deal to a meeting to remind them of the confidentiality agreements they had signed. "He read the riot act to everyone there," said a person who was at that meeting, telling them: "If anyone does anything, I'll make sure to find out.

"He's very soft spoken and easy going, but would act like el capo (boss) sometimes, putting the bankers in order," the person added.

Seven years on, Yao is now guiding e-commerce giant Alibaba Group through a planned US listing, expected to top Facebook's US$16 billion IPO as the biggest technology listing. The big change for Yao is that he is now leading from inside, having left Rothschild to join Alibaba. Otherwise, there is a sense of déjà vu.

Yao is again closely guarding the listing process, keeping a tight control of an issue that could pay out an estimated US$225 million in a bumper fee day for underwriters working on the deal.

At a March 25 meeting in Hong Kong, led by Yao, Alibaba kept most details secret until an hour before the scheduled event - to keep prying media at bay and avoid regulatory scrutiny from the US Securities and Exchange Commission.

Some of those invited were driven to the venue without being told where they were going. Others arrived at the exclusive Aberdeen Marina Club to assemble in a room booked under a secret name, to avoid linking it to Alibaba, said people who were at the meeting.

Yao, a Chinese-American and Wharton School graduate, was hired by Alibaba in late 2012 as senior vice-president, heading the corporate finance division, and was tasked with planning the IPO.