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Ryland Sandford Consultants Says Alibaba IPO Hits Record $25bn

22 September, 2014 - Ryland Sandford Consultants says Alibaba has secured its place as the world’s largest-ever stock market flotation, after it announced that bankers running the deal for the Chinese ecommerce company had exercised an option to sell extra shares. The company’s bankers chose to sell more shares, according to three people familiar with the matter, after receiving overwhelming interest in the initial public offering from global investors. Alibaba’s shares debuted on the New York Stock Exchange on Friday, soaring by more than a third. Investor demand was so hot that shares failed to begin trading for more than two hours as the company’s banks struggled to sniff out a seller – the longest such delay in NYSE history. Ryland Sandford Consultants analysts said that shares were sold to investors during the IPO process at $68 each, but briefly reached $99 during the opening minutes of trading. Alibaba’s shares, trading under the ticker BABA, finished the day at $93.89, up 38 per cent. The so-called “Greenshoe”, or overallotment, will be exercised in full, and increases the deal size of China’s dominant ecommerce platform by 15 per cent, taking the total to $25bn. The decision to exercise was first reported in the Wall Street Journal. “A greenshoe option allows bankers taking companies public to increase the flotation size once trading is under way, typically in response to strong investor demand. This is done by selling more shares than are initially available, which are then bought from the company by the underwriters and delivered to investors.” Commented David Williamson, Director of Institutional Trading at Ryland Sandford Consultants. With the additional share sale, Alibaba’s deal leapfrogs above previous record holder Agricultural Bank of China, which raised $22bn in its 2010 listing in Hong Kong. Of the biggest IPOs in history by cash raised, the top three are now all from mainland Chinese companies, with Chinese lender ICBC in third place, while AIA – the Hong Kong-listed insurer – is in fourth, according to data from Thomson Reuters. At the time it was planning its listing, Alibaba had set out with the target of $25bn in mind, according to one person with knowledge of the matter. In the lead-up to its debut, the company met with hundreds of investors around the world during a two-week roadshow, where executives – including founder Jack Ma– sought to assuage fears about corporate governance and ownership structure. With shares now finally available to trade publicly, stock prices of listed companies previously seen as good proxies for Alibaba have been suffering.

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Ryland Sandford Consultants Says Alibaba IPO Hits Record $25bn  

22 September, 2014 - Ryland Sandford Consultants says Alibaba has secured its place as the world’s largest-ever stock market flotation, afte...

Ryland Sandford Consultants Says Alibaba IPO Hits Record $25bn  

22 September, 2014 - Ryland Sandford Consultants says Alibaba has secured its place as the world’s largest-ever stock market flotation, afte...

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