Briefing: Alibaba may opt for second listing in Hong Kong

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Alibaba Weighs Raising $20 Billion Through A Second Listing – Bloomberg

What happened: Citing unnamed sources, Bloomberg reported that Alibaba is considering a second IPO, this time on Hong Kong’s stock exchange. The listing, which is still unconfirmed, could take place in the second half of this year and bring in $20 billion for the tech titan. Besides diversifying Alibaba’s sources of funding—its other listing is on the NYSE—the move could also be a result of heightening tensions between the US and China. Alibaba has declined to comment on the purported plans.

Why it’s important: If the listing went through, it would be a big boost for Hong Kong’s stock exchange, which last year saw the splashy debut of Chinese tech companies like Meituan Dianping and Xiaomi. While subsequent returns haven’t always lived up to expectation, last year Hong Kong loosened the rules to allow dual class stocks like Alibaba’s to list. Geopolitics, including a recent US blacklist of Huawei and its affiliates, likely play a significant role in the potential decision to list in Hong Kong. However, even before the trade war kicked off, Alibaba had already been looking to IPO in Hong Kong. Not only would it be closer to home for the company, but as an analyst told Bloomberg, Alibaba could potentially get a better valuation as a result.