Alibaba wants to establish Hong Kong as its second main listing market

Alibaba wants to establish Hong Kong as its second main listing market

by Josh Horwitz and Scott Murdoch

SHANGHAI/HONG KONG (Reuters) – Alibaba plans to make the Hong Kong Stock Exchange its main listing market, in addition to Wall Street, becoming the first major company to take advantage of a regulatory change in the Asian financial hub aimed at attract technology groups.

Already present on the Hong Kong Stock Exchange since 2019 via a secondary listing, Alibaba said it expects the procedure for setting up this new listing to be completed by the end of the year.

For the group’s managing director, Daniel Zhang, this dual listing would promote a “wider and more diversified investor base”.

Investors from mainland China will be able to benefit from the Stock Connect system which will give them easier access to securities listed in Hong Kong. Secondary listing is not permitted on the Stock Connect program.

The stock gained 4.82%, contributing to the 1.7% rise in the HSI index.

The move comes after the Hong Kong Stock Exchange changed its rules in January to allow some “innovative” Chinese companies to conduct a dual primary listing.

The American and Chinese authorities have been fighting for several months on the rules governing the audits of Chinese companies present on Wall Street with the risk that the latter will be expelled from the New York Stock Exchange.

Alibaba debuted on Wall Street in September 2014, marking the biggest IPO in history at the time.

Since 2020, its stock price has collapsed in both markets, US and Hong Kong, as Beijing tightened regulations on digital giants.

The e-commerce group was fined $2.8 billion in April 2021 by Chinese authorities for impeding competition.

(Reporting Josh Horwitz in Shanghai and Scott Murdoch in Hong Kong; with Anshuman Daga in Singapore, French version Laetitia Volga, editing by Jean-Stéphane Brosse)

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