Alibaba Maintains Share Capital Post-Listing Conversion

What Happened?

Chinese e-commerce giant Alibaba Group Holding Limited (NYSE: BABA) announced that it would maintain its share capital after converting its listed shares into Hong Kong Depository Receipts (HDRs). The conversion commenced on December 19, 2022, and is expected to be completed by January 12, 2023.

Why It Matters

The conversion allows Alibaba to enhance its flexibility in capital management and provides its shareholders with more trading options. The move also demonstrates Alibaba's confidence in the long-term prospects of the Hong Kong stock market.

Details of the Conversion

• Each American Depositary Share (ADS) will be converted into eight HDRs.
• Shareholders will receive HDRs in proportion to their ADS holdings.
• The conversion will not affect the underlying value of Alibaba's shares.
• Alibaba's share capital will remain unchanged at approximately 33.5 billion shares.

Market Reaction

Alibaba's stock price remained relatively stable in pre-market trading following the announcement. The conversion is not expected to have a significant impact on the company's overall market capitalization.

Additional Context

Alibaba's decision to maintain its share capital is in line with recent trends among Chinese companies seeking to enhance their presence in the Hong Kong stock market. The move also aligns with the Chinese government's efforts to promote Hong Kong as an international financial center.

Sources

• Alibaba Group Investor Relations
• Reuters: Alibaba to maintain share capital post-listing conversion
• Bloomberg: Alibaba to Keep Share Capital After Hong Kong Listing Conversion