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Alibaba Group looks to list in Hong Kong

Chinese online retailer Alibaba Group has confidentially filed to list on the Hong Kong stock exchange, and is expected to raise up to US$20 billion as soon as Q3 2019, according to Reuters.

The listing would be the sixth-biggest follow-on share sale in history, and would give mainland Chinese investors their first direct access the business.

The e-commerce giant already holds the record for the world’s largest IPO – its US$25 billion float on the New York Stock Exchange in 2014 – as well as holding the largest market value in Asia-Pacific at US$423 billion, according to Reuters.

Alibaba founder Jack Ma has previously stated that while the business was interested in listing in Hong Kong it was restricted due to listing rules conflicting with its management structure. These listing rules have now been amended.

Some onlookers have speculated that Alibaba is looking overseas in response to a perceived maxing out of its potential user base within the mainland.

The business recently saw its full-year revenue grow by 51 per cent during the year to March 31, 2019 to RMB376.8 billion ($81 billion), with net income growth 31 per cent to RMB80.2 billion ($16.8 billion).

When discussing the results, Alibaba executive chairman Joe Tsai told analysts the business was on the right side of the escalating trade war between the US and China.

“As we look at the evolution of the Chinese economy, Alibaba is on the right side of all of the issues,” Tsai said.

Tsai said the ongoing trade negotiations also create an opportunity for other markets to do more foreign business within China, satisfying growing demand from the Chinese public as the country’s economy shifts from an “export economy to a domestic consumption economy”.

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