Hedge funds piled into Alibaba shares in third quarter

Reuters News
|
Posted: Nov 14, 2014 4:25 PM

By Luciana Lopez

NEW YORK (Reuters) - Hedge funds scooped up shares of Chinese company Alibaba Group Holding in the third quarter, making the e-commerce giant one of the most commonly bought stocks among some of the country's biggest investors, according to regulatory filings on Friday.

Among the institutional investors that took new stakes in Alibaba were Jana Partners, the $11 billion hedge fund run by Barry Rosenstein, Janus Capital Management, Tiger Management, Louis Bacon's Moore Capital Management and Leon Cooperman's Omega Advisors.

Alibaba made its market debut in later September after a $25 billion initial public offering that ranked as the largest ever. Since pricing at $68 per share in the IPO, the stock has surged to about $115.

The five hedge funds bought the following stakes in Alibaba: Janus Capital Management, 3.464 million shares; Tiger Management, led by Julian Robertson, one of the best-known hedge fund managers, 1.216 million shares, enough to make Alibaba the largest single holding listed on its 13F form filed with regulators on Friday; Moore Capital, 1.52 million shares; Omega Advisors, 410,000 shares; Jana, 300,000 shares.

From Alibaba's market debut through the close of the third quarter on Sept. 30, the company's shares peaked at $99.70, suggesting, for example, that Janus paid at most $345.36 million for its stake. At the $68 IPO price, the same stake would have cost $235.55 million.

Jana declined to comment. Janus, Tiger Management, Moore and Omega did immediately not respond to requests for comment. Alibaba did not immediately return a request for comment.

While many stocks struggle after hype-laden debuts, Alibaba has advanced.

Mark Yusko, head of the $4 billion Morgan Creek Asset Management, told Reuters last month that the shares could more than double in the next three years, which could vault Alibaba past Apple Inc's current valuation, which ranks it as the world's biggest publicly traded company.

Yusko said Morgan Creek has bought Alibaba steadily, both before and as the company went public.

Last week, Alibaba founder Jack Ma, who is also the executive chairman, said the company's finance services arm "will definitely go public," and is looking at a mainland China listing for the e-commerce company's crown jewel.

Alipay, part of Alibaba's Ant Financial Services Group, is the lifeblood of the company's e-commerce network and China's dominant online payment processor, making it in the eyes of some analysts one of the most valuable assets in the Alibaba universe.

Friday's 13F filings provide a window onto the strategies of some of the world's biggest investors. But the view is limited. The documents look back to the previous quarter, and they do not disclose short positions.

The U.S. Securities and Exchange Commission sometimes allows managers not to disclose sensitive positions.

(Additional reporting by Sam Forgione and Svea Herbst-Bayliss; Editing by Jennifer Ablan and Leslie Adler)