(Xinhua File Photo)
HANGZHOU, March 16 (Xinhua) -- Chinese e-commerce giant Alibaba has decided to begin its initial public offering (IPO) process in the United States, the company announced Sunday.
The move is to "make us a more global company and enhance the company's transparency, as well as allow the company to continue to pursue our long-term vision and ideals," Alibaba said in a brief statement.
The statement did not mention the company's decision on the investment banks or stock exchange for the IPO.
However, media reports on Friday said Alibaba had decided on New York after ruling out Hong Kong and London for the IPO, while Morgan Stanley and Credit Suisse were said to be working closely with Alibaba on the listing plan.
Analysts predicted that Alibaba's IPO would raise billions of U.S. dollars, making it the largest IPO in the U.S. in recent years.
Showing more aggressive ambitions for international expansion, Alibaba also said that "should circumstances permit in the future, we will be constructive toward extending our public status in the China capital market in order to share our growth with the people of China."
Alibaba operates two of the nation's most popular online shopping services, Taobao and TMall. In the fiscal year ending on March 31, 2013, the two platforms' total transaction value exceeded one trillion yuan (163 billion U.S. dollars).
Hu Yanping, founder of Data-Center of China Internet, said that Alibaba has made a smart decision to start its IPO at the moment, because the U.S. is getting more open, with bigger capital market and great financing capabilities.
The move is widely seen as a reflection of the great progress that China's Internet industry has experienced over the years, which has created hundreds of millions of users and a huge market.
As the market of the Internet industry in China grows to a scale that no one can afford to ignore, the country is witnessing the biggest and most consecutive period when a great number of Internet companies are jumping on the bandwagon of seeking IPO overseas, according to Hu.
Hu attributed the trend to a slow recovery in the overseas capital market last year, as a large amount of capital has been flowing back to the U.S.. Meanwhile, the domestic market seems to be stagnating, despite some progress in the past few years, Hu said.
"Understanding of the Internet industry is still lacking in China, and mid- and long-term investment is quite limited," Hu explained, adding that the trend of listing overseas is a great loss to the market in the country.
While Alibaba's listing plan has aroused great expectations, experts worry that the company still has a spate of stumbling blocks to remove.
Alibaba has been accused of selling counterfeits on its online shopping websites, and despite its perennial efforts to tackle the problem, it will have to face skeptics regarding the violation of intellectual property rights, Hu Yanping said.
For companies like Alibaba to succeed in the IPO process, it is essential that they comply with standard while maintaining credibility, Hu said in a review of the performances of previous listed Chinese companies.
Wang Jun, an analyst with market researcher Enfodesk, pointed out that the performance of a listing company largely depends on its competitiveness.
"If collecting money is only what they want and they do not focus on long-term business growth, their share prices are likely to be unstable," Wang said.
(To stay up to date with the latest China news, follow XHNews on Twitter at http://www.twitter.com/XHNews and Xinhua News Agency on Facebook at http://www.facebook.com/XinhuaNewsAgency.)
Alibaba takes control of HK-listed ChinaVision
BEIJING, March 11 (Xinhua) -- China's largest e-commerce company Alibaba has agreed to buy a controlling stake in the Hong Kong-listed ChinaVision Media Group Limited, the latter said in a statement Tuesday. Full story
Yu'ebao boosts capital supply for economy: report
BEIJING, March 10 (Xinhua) -- Yu'ebao, a popular online wealth management product, will help boost funds available for China's real economy, instead of raising financing costs, an official report showed on Monday.
The product has served as a way of collecting small amounts of money from customers, according to a report filed to Xinhua by the Ali Small and Micro Financial Service Group, a branch of e-commerce firm Alibaba in charge of the service. Full story
China to promote healthy development of Internet finance
BEIJING, March 5 (Xinhua) -- China will promote the healthy development of its burgeoning Internet finance, according to a government work report delivered by Premier Li Keqiang on Wednesday.
"We will promote the healthy development of Internet banking," Li said at the opening of the annual session of the National People's Congress (NPC), China's top legislature. This is the first time that Internet finance has been written into the government work report. Full story