Jack Ma, ‘capital-lite’ model impress at Alibaba’s Boston IPO event 

Ma, the founder and executive chairman of Alibaba Group Holding, leaves following the company's roadshow meeting in New York

Alibaba Group Holding Ltd has two major things going for it as it prepares for an initial public offering that could raise more than $21 billion: founder Jack Ma and a “capital-lite” business model.

While corporate governance remains a concern, several fund managers and analysts said Ma gave an impressive performance during the company’s pitch in Boston on Tuesday for what stands to be the largest-ever U.S. technology IPO. They also said the Chinese e-commerce company’s business model features strong cash-flow generation and low capital intensity similar to U.S. Internet stars Facebook Inc and Google Inc.

“He’s executed well,” said Will Danoff, who runs the $111 billion Contrafund for Fidelity Investments.

Alibaba accounts for about 80 percent of all online retail sales in China and seeks to  raise more than $21 billion in the IPO, valuing the company at up to $163 billion. The offering is expected to price on Sept. 18 at $60 to $66 per American Depositary Share, according to a notice to brokerage customers from Fidelity.

Ma told about 150 people in Boston that the Alipay decision was the hardest of his life, but it was necessary for the growth of the company. He added that “history will judge,” said Adam Grossman, a research analyst for Middleton & Co.

Source: Reuters

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