Alibaba Group is aiming to raise US$3.17 billion through an offering of zero-coupon convertible notes, poised to be the largest of its kind this year. The Chinese e-commerce company’s notes, which mature in 2032, will be convertible into its American depositary receipts (ADRs), according to deal terms reported by Bloomberg News. Alibaba is a multinational technology company specialising in e-commerce, retail, internet, and technology. It provides consumer-to-consumer, business-to-consumer, and business-to-business sales services via web portals.
Following the announcement, Alibaba’s ADRs experienced a downturn, falling 1.7 per cent to US$141.53 each in after-hours trading on Wednesday (Thursday AEST). Prior to this dip, the ADRs had seen substantial growth, climbing 71.1 per cent in the year up to Wednesday’s market close.
The funds raised through this note offering are earmarked for several key strategic initiatives. These include expanding and scaling up the company’s data centres, upgrading existing technologies, and further developing its international commerce operations, according to the terms of the deal.
Alibaba currently faces intense competition in the Chinese market. The company is competing with other significant players in the Chinese e-commerce space, including Meituan and JD.com, as it vies for consumer attention and market share.
