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Alibaba files are planning to list in Hong Kong



Alibaba's listing in Hong Kong above will give Chinese mainland investors access to the shares via a trading relationship with mainland China.


Photo:

Dale de la rey / Agence France-Presse / Getty Images

Alibaba Group Holding


BABA 0.79%

has filed confidential paperwork for a Hong Kong listing, according to people who are familiar with the case, and turns off a process that could see the Chinese internet giant raising billions of dollars from a large share sales in the coming months.

The proposed stock offer is led by investment banks

China International Capital
Corp.

and

Credit Suisse

One of the people said.

News about Alibaba's confidential submission was previously reported by Bloomberg.

The entry plans come more than four years after Alibaba was published in New York after increasing $ 25 billion in what is still the world's largest original publicity

The online retail giant, which has the bulk of its business in China, has recently held a market value of about $ 417 billion, and is one of the country's two most valuable companies. The other is

Tencent Holdings
Ltd

, which is already listed in Hong Kong.

Given Alibaba's high market value, an offer of only 5% of the company's stock will be around $ 20 billion in stock.

A second listing in Hong Kong would create another big market for Alibaba's shares and include several investors familiar with the company – potentially increasing the valuation. Hong Kong has a trading relationship with mainland China that allows investors to buy and sell Hong Kong listed stocks.

Last year, Hong Kong's stock exchange changed the rules to pave the way for major Chinese companies already listed in the US or London to add a secondary list to the city. This meant that they could enter confidential paperwork with the exchange.

Companies usually launch stock quotes within two to three months of submitting applications to the exchange.

Other regulatory changes included allowing companies with different classes of voting to list in Hong Kong. Alibaba has a complex governance structure that gives the founder Jack Ma and other managers more control than other shareholders in the company.

Write to Liza Lin at Liza.Lin@wsj.com and Stella Yifan Xie at stella.xie@wsj.com


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