Alibaba’s Jack Ma Says Partnership Best Way to Protect Business

September 10, 2013 Leave a comment

Alibaba’s Jack Ma Says Partnership Best Way to Protect Business

Alibaba Group Holding Ltd. founder Jack Ma said a partnership system is the best way to protect the company’s value, and it is “not concerned” about where to hold potentially the largest initial share sale since Facebook Inc. Ma said in an e-mail provided to Bloomberg News that the current 28 partners are most likely to create value for customers, employees and shareholders. The partnership system “is not a mere profit sharing mechanism, nor is it a vehicle of power to exert greater control over the company,” he said.Alibaba, China’s biggest e-commerce company, asked Hong Kong’s stock exchange to allow a partnership to nominate a majority of board members, a person with knowledge of the matter said last month. That would enable Ma, with a 7.4 percent stake, and his management team to maintain control after an IPO. Hong Kong doesn’t allow new listings to have dual-class shares, as New York does.

“We are not concerned about where to go public, but we do care that wherever we end up going public must support this type of open, innovative, responsible culture that values long-term development,” Ma said in his e-mail dated today.

Alibaba declined to comment in an e-mailed statement.

Alibaba’s proposal will have to be approved by the Hong Kong stock exchange’s listing committee. The Hong Kong’s Securities and Futures Commission, or SFC, has the power to object to a listing application on “certain grounds,” according to a 2011 report by the regulator.

Hangzhou-based Alibaba, which connects businesses and consumers to each other across China, has a value of about $87 billion, according to the average of 11 analyst estimates released in July. It could raise about HK$100 billion ($12.9 billion) in an initial public offering, Ernst & Young LLP said in June.

That would be the world’s biggest since Facebook raised $16 billion in May of last year, and the city’s largest since AIA Group Ltd.’s $20 billion offering in October 2010, according to data compiled by Bloomberg.

To contact the reporter on this story: Lulu Yilun Chen in Hong Kong at ychen447@bloomberg.net

Filed under Macro Trends, TMT Trends

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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