Alibaba’s IPO Dilemma: Hong Kong or New York? Harvard Case Solution & Analysis

Alibaba decided to debut, in 2014, on the New York Stock Exchange, creating the largest IPO in history. Alibaba had various options regarding trading location, ownership structure, IPO pricing and IPO timing.

Although, the Hong Kong Stock Exchange seemed the most appropriate for Alibaba IPO, due to its cultural, language, and geographic proximity, but this initial desire to list on the Hong Kong Stock Exchange was denied due to the company’s desire to preserve its partner’s control over decision right.

On the other hand, the New York Stock Exchange accepted Alibaba’s requests to list dual class shares. Chinese market had been contributing around 86% of Alibaba’s revenue. While the investors from Hong Kong had the deeper understanding of Alibaba’s business, but the New York Stock Exchange allowed more liquidity.

Alibaba needed to evaluate the best decision regarding its IPO in this scenario. The writer, Emir Hrnjic, is affiliated with National University of Singapore.

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