Industrial and Commercial Bank of China (ICBC), the country's biggest lender, and property developer Kerry Group have agreed to become Alibaba.com's cornerstone investors in the e-commerce portal's HK$7.8 billion Hong Kong initial public offering, sources said. It will be a rare move for ICBC to subscribe to IPO shares in Hong Kong, as it was only recently that mainland banks were allowed to buy stocks outside the domestic market through the qualified domestic institutional investors scheme. Sources said the bank would buy Alibaba.com's shares through its Hong Kong-listed unit ICBC (Asia). They said ICBC, Kerry Group and Wharf (Holdings) were among five investors to whom Alibaba.com would sell US$145 million worth of shares. The cornerstone investors agreed to hold the shares for two years to show they were 'confident in Alibaba.com's business prospects', a source said. ICBC is a partner of Alipay, Alibaba Group's online payment service that allows users to conduct secured transactions. Alibaba Group is the listing candidate's parent. The Kerry Group, founded by Malaysian tycoon Robert Kuok, controls SCMP Group, the publisher of South China Morning Post. Wharf is a conglomerate whose business ranges from property to pay-television. Alibaba.com is also expected to bring in two other strategic shareholders, Yahoo Inc and Terry Guo Taiming, Taiwan's richest man. Yahoo, which owns about 40 per cent of Alibaba Group, might pay HK$780 million for about 2 per cent of the enlarged share capital, sources said. Details of Mr Guo's possible purchase were not yet decided, sources said. A spokesperson for Hon Hai Precision Industry, Mr Guo's Taiwan-listed flagship, said he was not aware of the company's investment in Alibaba.com but added that both firms would have further co-operation. Alibaba.com, which starts to meet investors today, plans to sell 858 million shares, of which 227 million shares are new and 631 million from its staff, sources said. After the listing, Alibaba Group will keep about 70 per cent of Alibaba.com. Trading in the shares will begin on November 6. Morgan Stanley and Goldman Sachs are joint global co-ordinators of the deal. Morgan Stanley forecast Alibaba's revenue will grow 48 per cent this year to 2.025 billion yuan. As of the end of June, the company 's more than 200,000 paying customers accounted for 1.04 per cent of its total of 24.6 million registered users. Net confidence The cornerstone investors agreed to hold the shares for two years Morgan Stanley estimates Alibaba's revenue this year will grow: 48%
