https://www.bloomberg.com/news/articles/2019-06-13/alibaba-files-for-a-hong-kong-mega-listing Alibaba Group Holding Ltd. has filed confidentially for a Hong Kong listing, people familiar with the matter said, moving closer to what is potentially the city’s biggest share sale since 2010, Bloomberg News reports. The offering from China’s largest corporation could raise as much as $20 billion, though Alibaba hasn’t finalized its fundraising target, the people said. An Alibaba representative declined to comment. The escape has started... Accounting regulation law that's gonna be passed eventually was scary for the chinese enron and likely deep in debt, in need of Dollars. They went to credit markets in the past for huge amounts even tho being highly " profitable " according to accounting.
Hong Kong is not a competitive stock market compared to U.S for retail investors. If I can buy AliBaba on U.S exchange with zero financial transaction tax, why buy the same AliBaba on Hong Kong Stock exchange which charges 0.1% stamp fee? Why pay the stamp fees unnecessarily? Brokerage fees for U.S stocks are generally lower too thanks to competition. Can't see any good reason to buy AliBaba on HKSE unless you are a sucker.
You're not the target audience. Hint: They don't need (or want) US investors. The more interesting question is whether NYSE:BABA will be fungible for HKSE:BABA (or 81237 or whatever crazy tickers they use). The arb golden goose is flying in....
It's not about U.S investors or Asian investors. Any retail investor with access to both U.S and HK stock markets will choose U.S markets to avoid paying 0.1% stamp fee to the Hong Kong government. Why throw your money away on stamp fees to the HK government? I believe even HKers themselves will try to avoid paying this tax and invest in AliBaba stock on U.S stock exchange.
I think you're missing the point. The target audience is not US investors. Let me put it another way: Most investors will use local stock exchanges. Traders are a different breed - and produce no value for a listed company for their actions.
Witholding tax is also an issue, Baba listed in the US should be taxed at US rates (30% for HK residents, 10% for chinese residents for instance) in HK it depends what Baba is considered, if it's a chinese company (A share) the tax will be 10%, if it's taxed the same way as HK companies it will be 0% if it's A shares the stamp tax is only paid upon buying, if it's a HK company it is paid upon buying AND selling. Dunno what happens if it's a non china adr. Indeed some people rather buy companies in HK exchanges rather than in the US, although at world level they might be a minority Besides it makes sense now for chinese owned companies to become less dependent on US regulators
luisHK, 30% witholding tax apply for U.S stocks on U.S exchanges but don't apply to ADRs. No 30% withholding tax for BABA. Otherwise, Jack Ma would not have listed his company in U.S. It will be very dumb of him to be taxed 30% to collect dividends from his own company.
Thanks for the correction, on top of that i just checked and it appears Baba doesn't pay any dividend, dunno whether it is expected to change.
What's the matter with you ? They have a market cap of 417 Billion on the NYSE, how the fuck would they NOT want US money ? They are deep in debt and rather sooner then later they will get delisted from NYSE... It is impossible for them to stay listed if the Accounting Regulation Law passes congress, which it will, so they will have to leave the NYSE eventually, might as well start the process in their minds. If you are ever interested, check their earnings report, read the past 3 Earnings as a example... It's about as Bernie Madoff as it can get, and I think it's even worst, it's just straight non sense. Their accounting method and earnings report is more of a fiction then star wars... Revenue is reported has one, no specific areas within the company broken down, nothing, they don't mention or give any details... Straight growth, straight profits, insane amount of employees on payroll and buy outs, all they do is win big every quarter. It's clearly CLEARLY a slush fund for the ccp, I mean they booted out Jack Ma from his own company... How does the SEC not even bother with this, this ain't a 400 million market cap, this is a company with a market cap of 417 Billion! https://deep-throat-ipo.blogspot.com/2018/02/alibabas-123117-quarterly-investor-call.html https://deep-throat-ipo.blogspot.com/2019/05/babaan-earnings-call-without-discussing.html Revenue is up 51% YOY, GMV up 19% (GMV is up $137 Billion from FY2018) all with only 36,000 more employees (according to this years filing/presser) (pg 18). Again, when you do the math BABA GMV of $853 Billion is about the same as global GMV (store sales + third party) for Walmart and Amazon combined, and up 10x from the fake $80 Billion in FY2012. The other ratio I find fascinating is GMV per employee. Walmart's GMV per employee is $284,000. Amazon's is $428,000. Alibaba's is $8,366,000 per employee. They are truly masters at doing more with less.