Alibaba Said to Agree on Terms for $3 Billion Loan This Week
Alibaba Said to Agree With Banks on Yahoo Loan Terms
Andrew Harrer/Bloomberg
Alibaba is borrowing the funds for a potential buyback of a stake that Yahoo! Inc. has in the company.
Alibaba is borrowing the funds for a potential buyback of a stake that Yahoo! Inc. has in the company. Photographer: Andrew Harrer/Bloomberg
Alibaba Group Holding Ltd. (ALIBABZ) plans to sign loan documents for a $3 billion facility with six banks as early as this week, according to a person familiar with the matter.
Meetings to discuss the financing’s final terms were held in Hong Kong yesterday and will possibly continue into the weekend, the person said, asking not to be identified as details are private. Australia and New Zealand Banking Group Ltd., Credit Suisse Group AG, DBS Bank Ltd., Deutsche Bank AG, HSBC Holdings Plc, and Mizuho Corporate Bank Ltd. are arranging the loan, the person familiar with the matter said today. The facility, which will be comprised of various tranches, may be marketed to other lenders in general syndication, the person said, declining to elaborate.
Alibaba Group, China’s biggest e-commerce company, owns more than 70 percent of Alibaba.com, which has been suspended from trading in Hong Kong since Feb. 9 as the company prepares a statement about a transaction involving its parent. Yahoo is the biggest shareholder in closely held Alibaba Group with a stake of about 40 percent.
Alibaba Group is borrowing the funds for a potential deal involving Yahoo! Inc. (YHOO), its biggest shareholder, the person said. Proceeds from the $3 billion loan could be used by Alibaba Group to help take the listed e-commerce site private and place it, along with other assets, in a newly created company, according to Kelvin Ho, an equity analyst at Yuanta Securities Co.
“That vehicle could then be exchanged in return for some of Yahoo’s stake in Alibaba Group,” he said by phone from Hong Kong today.
John Spelich, a Hong Kong-based spokesman for Alibaba Group, declined to comment on the $3 billion loan or any potential privatization of Alibaba.com when called at his office today.
No Clarity
Alibaba Group could offer to buy back shares in Alibaba.com at a price similar to the company’s value when it listed in 2007, Ho said. Alibaba sold shares in November of that year at HK$13.50 apiece. Its stock last traded at HK$9.25.
“Taking Alibaba.com private at HK$13.50 would be a good deal for shareholders and give the parent an asset to swap,” said Ho, who has a ‘hold’ rating on Alibaba.com shares. “But at the moment there isn’t any clarity.”
To contact the reporter on this story: Katrina Nicholas in Singapore at knicholas2@bloomberg.net
To contact the editor responsible for this story: Shelley Smith at ssmith118@bloomberg.net
Rate this Page