Alibaba IPO to boost employee fortunes to $8 bn
Employees of Chinese e-commerce giant Alibaba will see their fortunes swell to nearly $8 billion as the company prepares a massive US stock offering that could be valued at $25 billion.
Alibaba on Friday priced its stocks at the top end of the $66-$68 range before its trading debut on the New York Stock Exchange, according to documents filed with US regulators.
The offer price would make stocks owned by some 6,000 employees—both former and current of the group and its affiliates—worth nearly $8 billion in total. The employees held a combined 4.8 percent stake before the offering.
Alibaba could raise as much as $25.02 billion from its initial public offering (IPO) if options are exercised for additional demand, dwarfing the record $22.1 billion IPO by China's AgBank in 2010.
But founder Jack Ma had asked employees to be prepared for the changes this IPO could bring along and warned of possible challenges.
"We've worked hard, but not just so we could turn into a bunch of tuhao," Ma reportedly said in an internal letter sent to employees in late July, referring to a Chinese expression of "new money".
The letter was widely reported in China's state media in July.
Founded in 1999, the Hangzhou-based company has become China's dominant e-commerce company in just 15 years. Its consumer-to-consumer platform Taobao is estimated to hold more than 90 percent of the Chinese market with over 800 million product listings and around 500 million registered users.
"Today's Alibaba is different from what it was before, the society, the public, and even the government will have difference views and expectations of us," Ma said in the letter. "We must be mentally prepared."
© 2014 AFP