HONG KONG (AP) — A senior Alibaba executive has criticized the Hong Kong stock exchange for not allowing the Chinese e-commerce giant to go public with its unique management structure.
The company dropped plans this week to hold an IPO in the southern Chinese financial center because the stock market wasn't willing to make an exception to its listing rules. Instead, it's looking to New York for an initial public offering that analysts estimate could value the company at more than $100 billion.
That would dwarf the tech world's other hotly anticipated share offering by Twitter, which is estimated to have a market value of $10 billion.
In a column posted late Thursday on Alibaba's blog, Vice Chairman Joe Tsai said "Hong Kong must consider what is needed in order to adapt to future trends and changes."
Tsai said the company had ended its discussions for a potential listing. It's the first public acknowledgement that it has dropped its plans for an IPO in Hong Kong, which Tsai said was the company's "first choice" because most of its business is in China.
Hangzhou, China-based Alibaba failed to persuade the Hong Kong stock exchange to grant it an exception from listing rules to allow it to maintain a "partnership" structure in which top executives, who own 10 percent of the company, retain control of the board.
Chairman Jack Ma has described the partnership system, which currently includes 28 people, as essential to preserving the company's innovative culture.
Alibaba's proposal failed because it was at odds with the Hong Kong exchange's principle of treating all shareholders equally.
Tsai challenged the exchange over its rigidity.
"The question Hong Kong must address is whether it is ready to look forward as the rest of the world passes it by," he said.
Joe Tsai's post: http://shar.es/KG6ka
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