No business represents the rapid rise of the Internet in China quite like Alibaba, a company that is part eBay, part Google, and part PayPal.
Alibaba is now moving forward with plans for one of the biggest initial public offerings since Facebook’s rocky debut last year — but in New York and not in its home market.
Much is at stake for the Chinese company, and for its prospective advisers and potential investors. The offering could value Alibaba at more than $75 billion, slightly bigger than eBay and more than twice as large as Yahoo. It is expected to be several orders of magnitude larger than Twitter’s forthcoming public offering, already one of Wall Street’s most anticipated deals.
Still, Alibaba’s debut will land far away from Hong Kong, where the company had long sought to make its stock listing home. The Internet giant and its executive chairman, Jack Ma, have sought to keep control of the company firmly with its founders, following in the footsteps of Facebook and Google.
But the rules of the Hong Kong Stock Exchange prohibit dual classes of stock and other types of corporate structures that let minority shareholders preserve control of companies. Talks between the two sides over a potential compromise came to a halt Wednesday, according to a person briefed on the matter.
Now come the next steps toward a filing, which may arrive within months. Alibaba has not yet hired underwriters for the stock sale, although for months Wall Street firms have competed for a plum role. Banks have brought in their most senior deal makers to help make their case: Jamie Dimon, chief executive of JPMorgan Chase, attended a dinner held for Ma in Hong Kong this year, for instance.
Still others have pointed to their longstanding ties to Alibaba. Credit Suisse and Morgan Stanley, for example, helped the company raise $4 billion in financing last summer.
While companies planning mammoth public offerings can command low underwriting rates — Facebook paid its banks just 1.1 percent of the total proceeds from its stock sale — an Alibaba offering would most likely provide millions of dollars in fees. The Chinese company is expected to raise perhaps $15 billion in its offering.