Alibaba Group Holding Ltd., which rode China's emergence as an economic superpower over the past 15 years to become a massive online marketplace for everything from forks to forklifts, filed today for what could become the largest U.S. initial public offering ever.
The amount of $1 billion in a U.S. regulatory filing is a placeholder used to calculate registration fees that will change. Alibaba didn't specify how many shares it will offer in its IPO or what valuation it will seek. Those details will be provided closer to the actual sale.
Founded by former English teacher Jack Ma, 49, in a Hangzhou apartment, Alibaba started with a few dozen items for sale. Alibaba's market value is estimated at $168 billion, bigger than 95 percent of the Standard & Poor's 500 Index and the most valuable Internet company after Google Inc., according to data compiled by Bloomberg.
The company is looking to sell about a 12 percent stake, people familiar with the matter have said, which would make the offering around $20 billion based on the estimated value, topping a $19.65 billion offering by Visa Inc. in 2008, data compiled by Bloomberg show.
With today's filing, Alibaba begins a process that will take several months before it becomes a publicly traded company and involve revisions to the document and meetings with investors during a formal roadshow, after which a price for the shares will be set. The company also has to decide whether to list its shares on the New York Stock Exchange or Nasdaq Stock Market.
Alibaba now provides various marketplaces for buyers and sellers, as well as services that help them conduct their businesses. Taobao Marketplace, founded in 2003, enables millions of individuals and small businesses to sell products. Tmall.com operates as a virtual shopping mall, with retailers and brands offering products. Alibaba's other businesses include Juhuasuan, a flash-sales model, and eTao, a shopping search engine.