A cleaner sweeps the floor at the headquarters of Alibaba Group on the outskirts of Hangzhou, Zhejiang province on Friday. The New York Stock Exchange tested its trading systems over the summer to make sure Alibaba Group Holding Ltd's market debut on Friday goes without a hitch.
AFP/New York
Chinese online retail giant Alibaba is poised for a record-breaking stock market debut on Friday, with shares priced at $68 in a public offering that could be valued at $25bn.
The company will step into the spotlight on the New York Stock Exchange, priced at the top of the range of $66-$68 per share announced earlier this week, according to documents filed with US regulators.
The amount raised by the initial public offering (IPO) would be $25.02bn if options are exercised for additional demand, breaking the 2010 record of China's AgBank of $22.1bn.
Alibaba founder Jack Ma was expected to ring the opening bell on Wall Street for the market debut, according to persons familiar with the IPO.
Alibaba would have a market value of around $168bn based on the price, making it bigger than US rival Amazon.
The IPO allows investors to get a piece of the huge Chinese market, but it also will fuel Alibaba's international ambitions.
Alibaba's consumer services are similar to a mix of those offered by US Internet titans eBay, PayPal and Amazon, and it also operates services for wholesalers. It is known for the giant Chinese online marketplace Taobao, among other services.
The company earlier this year announced plans for a US marketplace called 11 Main, which is currently in a test phase.
Alibaba Group made a profit of nearly $2bn on revenue of $2.5bn in the quarter ending June 30. Revenue rose 46% from the same period a year earlier.
Alibaba decided to list in New York because it wanted an alternative class share structure to give selected minority shareholders extra control over the board; the Hong Kong bourse declined to change its rules to allow this.
The Chinese firm will trade under the symbol "BABA."
A US government panel has warned of risks to investors because of a complex corporate structure - Alibaba is registered in the Cayman Islands and controlled by a partnership through a series of shell companies.
Harvard law professor and governance specialist Lucian Bebchuk meanwhile warned that the structure which allows inside minority shareholder control at Alibaba is worrisome.
"With an absolute lock on control and a limited fraction of the equity capital, the Alibaba insiders will have substantial incentives to divert value from Alibaba to other entities," Bebchuk said in a New York Times blog this week.
The IPO is also a major event for US-based Yahoo, which bought a 40% stake in the Chinese online giant in 2005 for $1bn and still holds 22.4% of Alibaba. The California company is expected to walk away with some $10bn paring that stake down to 16.3%.
