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China's Alibaba seeks blockbuster initial public offering in US

SAN FRANCISCO -- Alibaba Group, the king of e-commerce in China, is dangling a deal that could turn into one of the biggest initial public offerings (IPO) in history.

In a long-awaited move Tuesday, Alibaba filed for an initial public offering of stock in the U.S. that could surpass the US$16 billion that Facebook and its early investors raised in the social networking company's IPO two years ago.

Alibaba's paperwork says it will raise at least US$1 billion, but finance professionals believe that is a notional figure to get the IPO process rolling and say that the Chinese company's ambitions for the share sale are much richer.

“This is going to be the granddaddy of all IPOs,” predicted Sam Hamedah, CEO of PrivCo, which researches privately held corporations.

Although it's not well known in the United States, Alibaba is an e-commerce powerhouse that makes more money than Amazon.com Inc. and eBay Inc. combined. It has helped drive the rise of e-commerce in China, a transformation that has given millions of households greater access to clothes, books and consumer electronics in a society that in the 1980s still required ration tickets for some supermarket items.

Shopping online has become even more popular as smartphones give more Chinese easy access to a computer. Alibaba's launch of an online payment system, Alipay, filled the gap for the shoppers who lacked credit cards. Still growing at an explosive rate, online shopping is forecast by consulting firm McKinsey to triple from 2011 levels to US$400 billion a year by 2015.

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In this file photo taken on March 26, 2013, a worker performs shadow boxing during an open day at the Alibaba Group office in Hangzhou in east China's Zhejiang province. (AP)

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