Alibaba to pay banks up to $32.3 million in fees for Hong Kong listing




Alibaba to pay banks up to $32.3 million in fees for Hong Kong listing


By Scott Murdoch

(Reuters) - China's Alibaba (N:BABA) will pay its investment banking syndicate up to $32.3 million for leading its Hong Kong listing which will raise up to $12.9 billion, according to documents filed with U.S. securities regulators.

The e-commerce giant employed two co-sponsors, China International Capital Corp (CICC) and Credit Suisse (S:CSGN), to head the deal which has been carried out over the past week.

The two lead banks were joined by Citigroup Inc (N:C), JP Morgan (N:JPM) and Morgan Stanley (N:MS) as joint global co-ordinators while HSBC and Industrial and Commercial Bank of China (ICBC) were appointed as junior book runners.

An additional supplementary prospectus lodged with the Securities and Exchange Commission (SEC) showed Alibaba would pay investment banking fees of $28.1 million for the sale of 500 million shares.

This would rise to $32.3 million if a so-called overallotment of an additional 75 million shares is issued, which bankers think will occur.

The fee split between the banks was not listed in the SEC documents but it is accepted industry practice that co-sponsors are paid the most and the remaining banks' fees are dependent on the amount of shares sold.

According to the filings, Citigroup was allotted more shares to sell than JPMorgan and Morgan Stanley as bookrunners.

A Hong Kong brokerage part-owned by Alibaba founder, Yunfeng Securities, was also listed as being a participant in the deal.

The investment banks will also benefit from the 1 per cent brokerage fee paid by investors buying stock in the secondary listing.

Alibaba's payment to banks sits well below the $90m cheque that Saudi Arabia's Aramco intends to write for the banks working on its slimmed down initial public offering (IPO).

The highest ever fee payment on a deal was Visa's 2008 IPO in New York which raised $19.6 billion and led to the company paying its banks $550.2 million, according to Dealogic data,

Alibaba's Hong Kong stock is due to start trading next Tuesday.





Related News

Gold Steadies on ‘China Week’ Fears; Palladium Remains Precious Metals Star
Today, 21:12
Investing.com - Gloomy Chinese data ahead of the crucial do-or-die week for the U.S.-China trade deal helped gold prices steady on Monday, despite virtually zero prospects for a Fed rate cut in December. Palladium, meanwhile, stayed on its
Taiwan Stocks Will Soar to Record in 2020, Analysts Say
Today, 21:06
(Bloomberg) -- This year’s unexpected 20% rally in Taiwan stocks is poised to close a final chapter in the history of its financial markets. The Taiex index is within 7% of its all-time high from 1990, a milestone that analysts say will likely be
Erdogan says Turkey to attain single-digit interest rates, inflation in 2020
Today, 21:03
ANKARA (Reuters) - Turkey will attain single-digit interest rates and inflation in 2020, President Tayyip Erdogan told state broadcaster TRT Haber on Monday, adding this will pave the way for an increase in investments. Turkey's central bank
Trump says doing well with China in putting together trade deal
Today, 20:27
WASHINGTON (Reuters) - President Donald Trump on Monday said the United States is doing well with China in hammering out a trade deal, as the clock ticks toward the levying of possible new tariffs on Chinese imports. U.S. tariffs on several consumer
Race to Run Bank of Canada Begins With Poloz Bowing Out in June
Today, 20:24
(Bloomberg) -- Stephen Poloz’s announcement that he won’t seek a second term as governor of the Bank of Canada kicked off the guessing game on who will succeed him in June. The contest comes as the central bank stubbornly keeps the nation’s



Latest News
Gold Steadies on ‘China Week’ Fears; Palladium Remains Precious Metals Star
09.12.2019 21:12
Investing.com - Gloomy Chinese data ahead of the crucial do-or-die week for the U.S.-China trade deal helped gold prices steady on Monday, despite virtually zero prospects for a Fed rate cut in December. Palladium, meanwhile, stayed on its record-high path, riding the winds of a global squeeze in the autocatalyst metal. Gold futures for February
Read more
Taiwan Stocks Will Soar to Record in 2020, Analysts Say
09.12.2019 21:06
(Bloomberg) -- This year’s unexpected 20% rally in Taiwan stocks is poised to close a final chapter in the history of its financial markets. The Taiex index is within 7% of its all-time high from 1990, a milestone that analysts say will likely be topped next year. That year marked the bursting of the bubble in Taiwan stocks, which had rallied even
Read more
Erdogan says Turkey to attain single-digit interest rates, inflation in 2020
09.12.2019 21:03
ANKARA (Reuters) - Turkey will attain single-digit interest rates and inflation in 2020, President Tayyip Erdogan told state broadcaster TRT Haber on Monday, adding this will pave the way for an increase in investments. Turkey's central bank has cut its policy interest rate by 10 percentage points since July to 14%. A Reuters poll last week
Read more
Trump says doing well with China in putting together trade deal
09.12.2019 20:27
WASHINGTON (Reuters) - President Donald Trump on Monday said the United States is doing well with China in hammering out a trade deal, as the clock ticks toward the levying of possible new tariffs on Chinese imports. U.S. tariffs on several consumer products, including mobile phones and toys, are set to kick in on Dec. 15, but there is hope the
Read more
Race to Run Bank of Canada Begins With Poloz Bowing Out in June
09.12.2019 20:24
(Bloomberg) -- Stephen Poloz’s announcement that he won’t seek a second term as governor of the Bank of Canada kicked off the guessing game on who will succeed him in June. The contest comes as the central bank stubbornly keeps the nation’s benchmark interest rate among the highest of all advanced economies, so one consideration for Prime Minister
Read more