Alibaba shares jumped 3% in morning trading on plans to pursue primary Hong Kong listing.
Alibaba currently maintains a secondary listing on the Main Board of the Hong Kong Stock Exchange and will apply for a change of listing status to a primary listing pursuant to the Hong Kong Listing Rules (the “Application”), which is expected to become effective prior to the end of 2022. Upon completion of this change, Alibaba will become a dual-primary listed company on the New York Stock Exchange in the form of American Depositary Shares (“ADSs”) and on the Hong Kong Stock Exchange in the form of ordinary shares. The Company’s ADSs listed in the United States and the shares listed in Hong Kong are fungible, and investors can continue to choose to hold their shares in the form of ADSs traded on the New York Stock Exchange or ordinary shares traded on the Hong Kong Stock Exchange.
Since the Company’s secondary listing in Hong Kong in November 2019, there has been a significant increase in its public float on the Hong Kong Stock Exchange. In the six months ended June 30, 2022, its average daily trading volume in Hong Kong was approximately US$0.7 billion, compared to an average daily trading volume of approximately US$3.2 billion in the United States. Given the substantial presence of its business operations in Greater China, the Company expects that its dual-primary listing status would allow it to broaden its investor base, and facilitate incremental liquidity, in particular expand access to China- and other Asia-based investors.
The completion of the primary listing process in Hong Kong is conditional upon and subject to, among other things, satisfaction of the relevant requirements of the Hong Kong Stock Exchange and market conditions. The company will make further announcement(s) with respect to the Application as and when appropriate.