- Alibaba will reportedly postpone its multibillion-dollar Hong Kong initial public offering due to rising political instability and protests within the city, according to Reuters.
- The deal was originally supposed to go into motion in August, and while a new time frame has yet to be established, Alibaba could pursue a listing as early as October if market conditions improve, Reuters reported.
- Protests broke out in Hong Kong 11 weeks ago over a controversial extradition bill, but it has since evolved into a broader, pro-democracy movement.
- Watch Alibaba trade live.
Political upheaval in Hong Kong has reportedly derailed Alibaba’s plans for a massive initial public offering.
The Chinese e-commerce giant has postponed its previously planned Hong Kong listing due to months of protests and political instability within the city, according to Reuters. The offering was expected to raise between $10 billion and $15 billion.
The IPO process was initially set to begin in August, and a new time hasn’t been decided on yet, Reuters said. But, if political tensions ease and market conditions improve, Alibaba could reportedly pursue a deal as early as October.
Protests have rocked Hong Kong over the last 11 weeks. The demonstrations began in response to a controversial extradition bill, but have since involved into a larger pro-democracy movement. The protests have frequently grown violent, and Chinese authorities have warned they could send the city into a recession.
"It would be very unwise to launch the deal now or anytime soon," a person familiar with the matter told Reuters. "It would certainly annoy Beijing by offering Hong Kong such a big gift given what’s going on in the city."
The listing has been a point of interest for investors seeking to gauge the business environment in Hong Kong. Losing Alibaba’s IPO would be a big hit to the Stock Exchange of Hong Kong, which still trails behind the New York Stock Exchange as the dominate marketplace for new listings.
In July, Anheuser-Busch InBev withdrew a proposed listing of its Asia Pacific Unit from the Hong Kong exchange. The IPO was expected to raise close to $10 billion.
According to Reuters, Alibaba doesn’t view the IPO as a pivotal move for its business, but rather as a way to
"diversify its access to capital markets."
If Alibaba successfully completes its IPO in 2019, it could eclipse Uber’s $8.1 billion listing as the largest of the year.
Shares of Alibaba listed on the New York Stock Exchange were up 28% year-to-date through Wednesday’s close.
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