Alibaba to be listed on New York Stock Exchange
Alibaba has amended its S-1 filing and has selected the New York Stock Exchange for its IPO, and will list under the stock symbol BABA.
Alibaba has submitted a new amendment to its S-1 filing -- a form submitted for registering with the SEC before going public -- disclosing that the company would be listing its shares under the symbol "BABA" with the New York Stock Exchange.
Alibaba's initial prospectus filing had disclosed that the company would file its IPO in New York; however, whether the company would file with the New York Stock Exchange or NASDAQ was unclear.
There's no material benefit to deciding between the NYSE and NASDAQ, and in fact IPO underwriters generally don't have a preference. Sources familiar with the Alibaba IPO told CNET that one of the reasons that affected Alibaba's decision to choose the NYSE was the tech issue that plagued the NASDAQ when Facebook issued its first shares on the market on May 18, 2012.
Due to a technical glitch that crashed NASDAQ's trading system, investors buying or selling Facebook shares were unable to execute trades on the NASDAQ platform for nearly 30 minutes after Facebook's debut on the market. NASDAQ was fined $10 million by the Security Exchange Commission for the incident.
CNET reached out to Alibaba for comment regarding the company's decision to select the NYSE rather than NASDAQ, however Alibaba's spokeswoman declined to comment.
The date of the IPO has yet to be revealed, but multiple sources suggest an August IPO, speculated to take place on August 8.
"We participated in a comprehensive and deliberate exchange selection process and we are pleased to welcome Alibaba Group to the New York Stock Exchange, where they will join our network of the world's best companies and leading brands," said a NYSE spokesperson in a statement.
While Chinese technology firms like LightInTheBox, JD.com and Weibo quickly opted for a New York IPO in lieu of listing with Hong Kong, Alibaba's first choice was reportedly Hong Kong's HKEx. However, Alibaba has a tumultuous history with the Hong Kong exchange.
Alibaba initially offered Alibaba.com, the company's B2B manufacturer sourcing exchange, in 2007 in Hong Kong only to delist five years later for failing to exceed the price of the initial offering.
More recently, prior to Alibaba's prospectus filing last month, Hong Kong's HKEx was the likely contender to win the bid for Alibaba's IPO, expected to be the largest tech IPO in history.
However, talks between HKEx and Alibaba reportedly fell through when the Hong Kong exchange rejected Alibaba's requirement that its founders remain in control of the voting rights so it can control whom the company elects to its board of directors.
The HKEx and Hong Kong securities regulator, the Securities and Futures Commission, require that each shareholder is allowed just one vote under its "one share, one vote" rule, meaning simply that even majority shareholders would have the same voting rights as each minority shareholder.
The New York Stock Exchange and NASDAQ, on the other hand, do not require its listed companies to abide by this type of voting regulation -- a near-perfect fit that's likely driven Alibaba to list in New York.
The New York Stock Exchange and NASDAQ on the other hand offer a dual class stock structure that can allocate voting rights to majority shareholders, but not minority shareholders. Both exchanges, unlike the HKEx, do not require its listed companies to observe the "one share, one vote" regulation.
Update, 10:00 BST: This story was updated with information on Alibaba's decision to choose the NYSE.