Beautiful Virgin Islands

Tuesday, Jun 03, 2025

Why Alibaba is betting on Hong Kong

Political protests and petrol bombs aren't the ideal backdrop for a top global company looking to raise billions of dollars from investors.

But that's exactly what Alibaba is doing.

The Chinese e-commerce giant is preparing to raise at least $11bn (£8.5bn) by listing its shares on the Hong Kong stock exchange next week, in what could be the year's biggest public share sale.

"Hong Kong is one of the world's most important financial centers," reads a letter to potential investors from Alibaba's chairman, Daniel Zhang.

"During this time of ongoing change, we continue to believe that the future of Hong Kong remains bright."

That's a pretty optimistic assessment given the violence on university campuses and the streets of Hong Kong this week alone.

So why now? And what does the multi-billion dollar listing tell us about investor confidence in Hong Kong?

Sources close to the company say political unrest in Hong Kong wasn't a factor in whether to go ahead with the listing, and the social upheaval doesn't appear to have affected appetite for Alibaba's shares.

The share offer closed ahead of schedule, which means that investors snapped up the stock at a faster pace than expected.

But some say the timing of the listing is questionable.

Max Bondurri, founder of SGMC Capital, says Alibaba could have raised more funds if it had waited.

"From a purely economic point of view they could have waited till next year to list, at a time when some of the unrest may perhaps have died down."

However, he believes the decision to list now was motivated also by political, rather than purely financial, concerns."

The suggestion is that Beijing can influence decision-making at Chinese companies to serve its political interests.

"It's an attempt to take the negative headlines away from what's going on in the streets and universities," he says.

"It will help to remind international investors that Hong Kong is still open for business."

Still, the protests have had an impact. The listing event itself is likely to be low-key and low-profile.

It is unclear whether Jack Ma, the exuberant former chairman whose name has become synonymous with the e-commerce giant, will attend. It's also not clear if Mr Zhang will be there.

This raises questions about the level of concern the firm might have about potential violence outside the exchange or near its executives.

Investors won't queue up outside the exchange or banks to get their hands on paper receipts because Alibaba has decided to go paperless for this listing - the first time a firm has done so in Hong Kong. Some have said this is to avoid the risk of protestors attacking investors who might be out on the streets.


A boost for Hong Kong?

Alibaba's listing is likely to distract from the violence playing out on the streets, for a few days at least.

It may also reassure investors that if a giant such as Alibaba is willing to take the risk and list its shares in Hong Kong, the city's reputation as a financial hub must still be intact.

Weijian Shan, the man often described as Asia's private equity "king", told me the Hong Kong Stock Exchange was the only "bright spot" in an economy currently beset by violent turmoil and recession.

A quick guide to the Hong Kong protests

Hong Kong in first recession for a decade

How protests pushed HK's economy to the brink

More than two hundred Chinese companies are listed on the Hong Kong Stock Exchange, making up almost half of the exchange's value.

Their value is unlikely to be affected by the day-to-day protests, although negative sentiment from the political crisis no doubt filters through to the stock market in moments of heightened tension.

Still, concerns over Hong Kong's reputation should be taken seriously - and it's not just because of the unrest.

Increasingly, there's a perception in the business community that Beijing calls the shots in Hong Kong.

This week, Chinese state media came out strongly against a decision by Hong Kong's courts that the anti-mask ban was unconstitutional, raising fears that Beijing will wade in even further.

This potentially threatens the independence of Hong Kong's judiciary, the sole reason international companies come to the city and list there.

Hong Kong's courts are - for now at least - still independent from China's. The more that fades, the more Hong Kong's future as an international financial centre is diminished - whether companies like Alibaba choose to list there or not.


Back to its roots

Against a complicated political backdrop, Alibaba has long expressed a desire to bring the company "home" to Hong Kong.

It had hoped to list its shares there in 2014, when the firm first went public. But the city's listing rules at the time meant it made more sense for the company to float in New York.

An investor in Alibaba's US shares told me that the Hong Kong listing was a "genius move", because it will allow mainland Chinese investors to buy shares in a company they know well.

"Expect the shares to pop on the first day of trade," says the investor, who didn't want to be named.

"Mainland Chinese investors will want to show their support for a company they see as one of their own."

Even though Alibaba has no shortage of cash, the Hong Kong listing could help to raise money for future challenges, especially in the US.

"Because of the US-China trade war, there's more scrutiny of Chinese companies listed in the US," he says.

"If Alibaba raises this cash in Hong Kong, it allows them to potentially delist their shares in the US if they run into any trouble with US authorities in the future over any potential national security concerns."

For now, Alibaba says there are no plans to delist its shares in the US.

"The New York Stock Exchange is the primary listing venue" an Alibaba spokesperson told me. "We will continue to be listed and traded on the New York Stock Exchange."

Newsletter

Related Articles

Beautiful Virgin Islands
0:00
0:00
Close
Panama Port Owner Balances US-China Pressures
France Implements Nationwide Outdoor Smoking Ban to Protect Children
German Chancellor Merz Keeps Putin Guessing on Missile Strategy
Mandelson Criticizes UK's 'Fetish' for Abandoning EU Regulations
British Fishing Boat Owner Fined €30,000 by French Authorities
Dutch government falls as far-right leader Wilders quits coalition
Harvard Urges US to Unfreeze Funds for Public Health Research
Businessman Mauled by Lion at Luxury Namibian Lodge
Researchers Consider New Destinations Beyond the U.S.
53-Year-Old Doctor Claims Biological Age of 23
Trump Struggles to Secure Trade Deals With China and Europe
Russia to Return 6,000 Corpses Under Ukraine Prisoner Swap Deal
Microsoft Lays Off Hundreds More Amid Restructuring
Harvey Weinstein’s Publicist Embraces Notoriety
Macron and Meloni Seek Unity Despite Tensions
Trump Administration Accused of Obstructing Deportation Cases
Newark Mayor Sues Over Arrest at Immigration Facility
Center-Left Candidate Projected to Win South Korean Presidency
Trump’s Tariffs Predicted to Stall Global Economic Growth
South Korea’s President-Elect Expected to Take Softer Line on Trump and North Korea
Trump’s China Strategy Remains a Geopolitical Puzzle
Ukraine Executes Long-Range Drone Strikes on Russian Airbases
Conservative Karol Nawrocki wins Poland’s presidential election
Study Identifies Potential Radicalization Risk Among Over One Million Muslims in Germany
Good news: Annalena Baerbock Elected President of the UN General Assembly
Apple Appeals EU Law Over User Data Sharing Requirements
South Africa: "First Black Bank" Collapses after Being Looted by Owners
Poland will now withdraw from the EU migration pact after pro-Trump nationalist wins Election
"That's Disgusting, Don’t Say It Again": The Trump Joke That Made the President Boil
Trump Cancels NASA Nominee Over Democratic Donations
Paris Saint-Germain's Greatest Triumph Is Football’s Lowest Point
OnlyFans for Sale: From Lockdown Lifeline to Eight-Billion-Dollar Empire
Mayor’s Security Officer Implicated | Shocking New Details Emerge in NYC Kidnapping Case
Hegseth Warns of Potential Chinese Military Action Against Taiwan
OPEC+ Agrees to Increase Oil Output for Third Consecutive Month
Jamie Dimon Warns U.S. Bond Market Faces Pressure from Rising Debt
Turkey Detains Istanbul Officials Amid Anti-Corruption Crackdown
Taylor Swift Gains Ownership of Her First Six Albums
Bangkok Ranked World's Top City for Remote Work in 2025
Satirical Sketch Sparks Political Spouse Feud in South Korea
Indonesia Quarry Collapse Leaves Multiple Dead and Missing
South Korean Election Video Pulled Amid Misogyny Outcry
Asian Economies Shift Away from US Dollar Amid Trade Tensions
Netflix Investigates Allegations of On-Set Mistreatment in K-Drama Production
US Defence Chief Reaffirms Strong Ties with Singapore Amid Regional Tensions
Vietnam Faces Strategic Dilemma Over China's Mekong River Projects
Malaysia's First AI Preacher Sparks Debate on Islamic Principles
White House Press Secretary Criticizes Harvard Funding, Advocates for Vocational Training
France to Implement Nationwide Smoking Ban in Outdoor Spaces Frequented by Children
Meta and Anduril Collaborate on AI-Driven Military Augmented Reality Systems
×