Alibaba Group Holding Ltd. is looking to raise up to $ 8 billion by selling bonds in dollars as early as next week, according to people familiar with the matter.
The e-commerce giant aims to raise at least $ 5 billion, but could end up with more depending on the reception, said people who are not allowed to speak publicly and asked not to be identified. The agreement will be a many-the tranche offer, with specific tenors that have not yet been set, they said. Alibaba declined to comment. Reuters reported earlier the planned sale.
Withdrawal of the sale at a time when Jack Ma’s empire is facing intense government pressure at home would be a sign of global investor confidence in the company. In recent months, officials have blocked the Ant Group Co. IPO. $ 35 billion, proposed new rules to reduce the dominance of Internet giants and fined Alibaba for acquisitions in previous years. Closer control of mergers and acquisitions could add uncertainty to the growth of large internet companies.
“We consider the issue to be somewhat exploratory, given the wider uncertainty surrounding Ant / Jack Ma,” said Chuanyi Zhou, a credit analyst at Lucror Analytics in Singapore. “It could reveal how seriously global investors perceive the rapidly evolving regulatory environment in China and the potential impact on Alibaba.”
Alibaba raised about $ 11 billion from the sale of shares in Hong Kong at the end of 2019 and had a cash flow of nearly $ 90 billion at the end of September.
The sale is taking place as companies rush to issue bonds. Borrowers have sold more than $ 65 billion in bonds globally so far this year, following a record $ 3.6 trillion in 2020, according to data compiled by Bloomberg.
Company exploited the global debt market in 2014 for the first time to raise $ 8 billion shortly after its major debut in New York equities. The latest to hit the offshore market with a $ 7 billion bond transaction in 2017 and is due to repay or refinance a $ 1.5 billion debt due this year, according to data compiled by Bloomberg.
Big sellers
China’s largest dollar bond bids sold in the last decade
Source: Bloomberg
The Alibaba dollar bond, due in 2027, is trading at about 111 cents per dollar, according to prices compiled by Bloomberg.
In recent years, Alibaba has spent billions acquiring stakes in promising startups, expanding its logistics network and cloud hosting services, and building an international business through Singapore’s Lazada online mall. He is now engaged in a bruised fight with Meituan in food delivery, while fighting rivals such as JD.com Inc. and Tencent Holdings Ltd. in businesses, from grocery to retail.
– With the assistance of Adrian Yim, Coco Liu and Edwin Chan