Chinese e-commerce giant Alibaba Group Holdings Ltd (NYSE:BABA)’s listing on the New York Stock Exchange has become the biggest ever IPO at $25.03 billion. The company had priced its IPO at $68. Strong demand for its stock pushed the stock price up by 38% on the first day of trading. Everyone wanted to be part of the booming Chinese e-commerce industry. So, why would underwriters of the offering stay behind?
Alibaba said in a press release Monday that gross proceeds for the company and its selling shareholders rose to $25.03 billion after underwriters exercised in full the greenshoe option to buy an additional 48.01 million American depository shares of Alibaba. The Chinese company has a market value of close to $225 billion, more than the combined market value of Amazon.com, Inc. (NASDAQ:AMZN) and eBay Inc (NASDAQ:EBAY).
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