Alibaba Now Expected To Raise $10 Billion From Its Bond Offering

After a massive debut in September in US equity markets, Alibaba Group Holding Ltd BABA is up for a similar debut in the bond markets. As Bloomberg reported in a piece on Thursday, Alibaba “has $43 billion of orders from investors in a debut bond offering, more than five times what the company was said to be seeking, people with knowledge of the deal said.

 

Now, the earlier figure of $8 billion that Alibaba was seeking to raise has been increased even further to $10 billion, according to Dow Jones. CNBC’s David Faber elaborated on this report from Dow Jones.

 

“Dow Jones reporting a short time ago that Alibaba could upsize that debut bond deal to as much as $10 billion dollars that they are setting an investor for, I have not confirmed this. Alibaba, also they say, having received more than $55 billion in orders for that sale, citing sources.  Regardless of where it ends up, whether its $8 or $10 billion, it will be the debut of course for Alibaba in the US fixed-income investment grade market for debt.”

 

Faber highlighted a pattern developing from large Tech companies that go for IPOs, “Twitter went public, did a bond deal, Facebook went public, did a bond deal. So, (the part of maturation somewhere) of these companies of course. This company having gone public only what two months or so […]”

 

Faber thinks that there is some kind of hedging going on in the hedge fund community, where they are selling Alibaba shares and buying Yahoo! Inc. YHOO’s shares. He attributed this hedging to the recent decline in Alibaba’s shares and the rise of Yahoo’s shares. 

Posted In: CNBCBondsMarketsMedia
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