Alibaba Group Holding Ltd is China's e-commerce giant. On Wednesday, the media reported that the company will use the proceeds from an initial public offering to fund acquisitions. The firm wanted to broaden its mobile services.
Alibaba Chief Executive Officer Jonathan Lu said in the China Daily that the company would not include most of its financial businesses in the potential IPO. These businesses he referred to included Alipay online payment platform and its micro loan services. People familiar with the matter said the company has intensified its discussions with investment banks over the past few weeks. The talks were for a possible IPO although the company has not yet officially announced their plans said sources.
The e-commerce giant is expected to be valued at US$60-US$100 billion. The company could raise US$15 billion that would make it one of the world's largest internet IPOs. The initial public offering possibility of the firm would be a much sought after prize for stock exchanges and bankers.
China Daily reported that most of the revenue of the company came from its e-commerce platforms like Taobao and would sell only its profitable units in the IPO. Last May, Alibaba paide US$294 million for 28% stake in AutoNavi. The company also invested US$586 million for an 18% stake in Sina Corp's Weibo business.
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