Alibaba Said to Weigh Good Fortune of No. 8 in Choosing IPO DateLeslie Picker and Zijing Wu
There are two common interpretations for the word “ba” in Chinese. Literally, it can mean “eight.” Superstitiously, it denotes “fortune.”
It’s no coincidence, then, that Alibaba Group Holding Ltd. -- with back-to-back “ba’s” in its own name -- is targeting a U.S. trading debut of Aug. 8, according to people with knowledge of the matter. The company’s co-founders Jack Ma and Joe Tsai both see it as auspicious, the people said, asking not to be named because the information is private.
Management also prefers having BABA as a ticker symbol, one of the people said. Alibaba isn’t limiting itself to the eighth day of the eighth month. A weak market or a myriad of other factors could slow the deal and push it back until September, the people said.
Chinese consider the number eight to be lucky because “ba” sounds like the word for prosperity, “fa.” Aug. 8 has worked for other momentous Chinese events in the past. The 2008 Beijing Olympics -- credited by the International Olympic Committee as an “indisputable success” -- commenced on 8/8/08.
Ma and Tsai aren’t alone in favoring the tradition on large deals. When Thai billionaire Charoen Sirivadhanabhakdi was negotiating an $11.2 billion takeover of Singapore’s Fraser & Neave Ltd., his penchant for lucky numbers led to a price of S$8.88 a share for part of the deal, people close to the matter said last year. Charoen is ethnically Chinese.
Ashley Zandy, a spokeswoman for Alibaba in San Francisco, declined to comment on a potential trading date for the IPO. The potential for an August IPO was earlier reported by CNBC.
Alibaba has already shown its backers some good fortune. The IPO may be the largest ever in the U.S., with a float size estimated at around $20 billion and the Hangzhou-based e-commerce giant’s total value estimated at about $168 billion, up more than fivefold in just a few years.
More will be needed: To sell billions of dollars worth of shares, the company will need to rope in the biggest investors, and generate enough demand that it trades higher on the first day.
The number eight has certainly made its way into Alibaba’s culture. The Hong Kong stock exchange’s ticker of Alibaba.com Ltd. was 1688, which sounds like “make a fortune” in Chinese. While Alibaba.com was taken private in 2012, the numerical combination endures as 1688.com, one of the company’s websites.
Luckily for Alibaba, BABA is available in the U.S., after Santa Fe Petroleum Inc. changed its ticker from that to SFPI in 2012. BA, of course, is Boeing Co.’s handle. Alibaba may also consider the ticker ALBB, one person said.
Still, Alibaba may be pushing its luck with an August debut. Fund managers are often away for their summer holidays during the month, and trading volumes in the U.S. slump.
Of the 100 largest IPOs to list in the U.S., only two -- Google Inc. and Petroleo Brasileiro SA -- debuted in August, data compiled by Bloomberg show. If Alibaba can't meet the Aug. 8 target, it would probably push the deal back until September, the people said.
The good news is that nine -- which sounds like “long lasting” in Mandarin -- is also a lucky number.