Adam Roseman on Alibaba’s Shares

On May 15, 2012, in Adam Roseman, by admin

Shares of have seem some significant growth in Hong Kong over the past few weeks. Adam Roseman of ARC China explains that this is a result of optimism regarding the company’s privatization plan.

In a newsletter, Roseman wrote: “Alibaba’s offer to make private its Hong Kong-listed arm for 13.5 Jong Kong dollars per share, which is on par with the price when the business-to-business portal went public in late 2007, represents a 60.4% premium over the company’s latest 60-day average closing price.

“Analysts expect the privatization to go ahead because of the high premium, fragmented minority shareholders, and the prospect of continuing earnings and share price weakness. Alibaba Group holds 73% of the unit’s shares, and among the largest independent shareholders are Morgan Stanley, Vanguard Group and Capital International.”