Alibaba going public, not can’t

author: wang

since alibaba public news release, the media will never die. Dissension of various analysis, cheered or bad-mouthing, in short, anyone can advise. Somebody thinks, ali around a circle, with Hong Kong and coquetry and break up, eventually have to back to Hong Kong. Support the claim three reasons: first, from the market environment of Hong Kong, the most suitable for ali. Secondly, ali to U.S. public litigation risk; Third, ali credit in the world, particularly in the United States has been badly damaged.

I also to gather together a jollification, according to the three paths to make a comprehensive analysis.

in the first place, on a trip to Hong Kong or go to the United States listed the problem is that the ghost knows, preferred choice nature is Hong Kong. Ali major business in mainland China, Hong Kong have geographical and cultural advantages over the United States. B2B listed in Hong Kong and, considering the previous ali, ali are more familiar with Hong Kong capital market operation process, the preferred Hong Kong is a natural thing.

of course, I also heard another explanation is that, ali had tendency of Hong Kong, for one reason, because ali the offering hope to avoid too high valuations. Ali: why don’t want overvalued? Ali group CEO Mr. Lu, previously in Hong Kong has taken the words understand, ali the offering not only value valuation, will not seek to maximize capital interests. He said, “now alibaba group abundant cash flow, can support the business development, and raised to prepare for a future purchase.”

in fact, this problem can not be so hard to understand, don’t forget, according to the agreement, yahoo and ali when ali must buy yahoo holds a 10% stake in ali. If you, you want to buy what price?

let’s see how much the U.S. market p/e ratio is high, despite the market of technology stocks overall p/e ratio has fallen to its lowest level for seven years, but in terms of the relative to the Hong Kong market p/e ratio, is still high. Hong kong-listed tencent current p/e ratio is about 35 times, while listed on the nasdaq guest to play YY, p/e ratio is close to 51 times, sina, elong two higher p/e ratio of 83.57 and 388.75. Listed on the nyse qihoo, p/e ratio was as high as more than 90, 70 today.

again, company valuations consul general is not a bad thing? So ali and the public, why not.

went on to say that your second question, ali to us exactly what obstacles?

analysts say, ali would not listed in the United States, because they are worried that the U.S. market class-action lawsuits and disclosure of financial audit risk. I want to say is, isn’t that all hope of all companies listed on the open market are faced with the problem? Is not unique, ali is not only for the shares of the company.

in August this year, lanting collection of potential by U.S. law firm and a number of collective action, is its release is accused of misleading statements. In fact, including several Internet companies such as sina, 51 job network, have encountered class-action lawsuits in the United States.

the New York stock exchange, chief representative of Beijing Yang Ge said that the us market is based on information disclosure regulation, the principle of a lot of information to the SEC and exchange is not itself to its good or bad, but to the market and investors to judge, but requires listed companies to the SEC and exchange to disclose the information. Therefore, Chinese enterprises must be in accordance with the relevant laws and regulations to do a good job of information disclosure.

last month, I saw the nasdaq group, China’s chief representative yeeli hua zheng hand, she also said that since the end of 2011, has experienced such as fraud, encounter short exposure after the “consolidation”, American investors confidence in Chinese companies is growing, as long as the company of good quality and now is a good window period.

remember that on one occasion, I go to interview, CEO Gavin ni, founder group, “he said in the United States, class action is a very common phenomenon, is often caused by falling stock prices. Class action does not represent the enterprise really out of the question.

to be fair, ali’s fundamental viewpoint, it is not scared did not dare to go to the public.

look at the third question, pay treasure to VIE events affect the investment community confidence in alibaba?

in fact, as in August 2011, alibaba, yahoo and softbank pay treasure equity transfer event formally signed the agreement, yahoo and softbank, have said is the result of an “ideal”. According to the agreement, pay treasure listed holding company in the future will pay up to $6 billion in cash, in which yahoo and softbank up to $2.58 billion and $1.758 billion.

director William Blair with wu wei in this opinion, “is in crisis has come to an end, and, after a wave of privatization of investor confidence in the us, new Oriental events also let American investors accept slowly, VIE is access to some of China’s industry.”

last year, ali for yahoo share repurchase agreement, completed the nearly $8 billion in financing. If investors concerns over what ali, the $8 billion how ability take out? Forgot who said this sentence, “there is no more difficult decision than take out the money in the future”.

take a look at a list of institutions provide a $8 billion loan for ali, anz bank, credit suisse, citigroup, deutsche bank, DBS, HSBC holdings PLC and jpmorgan chase, Morgan Stanley and mizuho corporate bank. These are all active in overseas capital markets a line of syndicated, imagine, if the investment institutions and investors more worries for alibaba, is emphatically not put up such a large of money to invest.

don’t forget more, this 8 billion in loans for full credit, without any physical assets as collateral, and more include a total of $1.5 billion in revolving credit loan, to be syndicated recognition of alibaba’s credit strength.

what is revolving credit loans? Refers to the banking industry for joint lending organization of loan enterprise based on the credit strength of a kind of credit plan. During the validity period of agreement, as long as the enterprise’s loan amount does not exceed maximum amount, the bank must satisfy the business enterprise at any time request of borrowing, can use at any time within the line extraction, also can return ahead of schedule.

of course, on the other hand, the nine syndicate is willing to lend money to alibaba, also believe that its IPO soon. Alibaba in the U.S. have obstacles and threshold, in their hearts than outsiders.

so, I believe that vote with their feet of the local tyrants, not by mouth comment masters.