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http://www.telegraph.co.uk/finance/newsb...-move.html
Alibaba could add billions to its valuation with one simple move
Chinese ecommerce giant could increase price range of IPO shares as it prepares to close order book due to high investor demand
Alibaba is expected to close the order books on its record-breaking initial public offering early after high demand from investors.
The Chinese ecommerce giant, which is planning to float in the US this month, is confident it will sell all the shares offered to the market at the upper end of the $60 to $66-a-share price range, sources told The Telegraph.
The level of interest suggests that Alibaba’s banks could increase the this range, netting the 15-year-old company substantially more than the $24.3bn (£15bn) it is looking for. Even at this level it would be the largest tech IPO in history, valuing Alibaba at up to $167bn.
Alibaba’s banks, including Goldman Sachs, Credit Suisse and Deutsche Bank, will stop taking orders from investors in Asia on Wednesday, a day earlier than expected.
A final price for the shares is still expected to be set on Thursday.
At market cap of $167b, it is much much higher than my initial valuation of $120b.
As of 5 Feb 2014
Market cap of Yahoo! - $42.65B
Market cap of Yahoo! Japan - $22.0B using USD/JPY 107.3. Since Yahoo has a 35% equity interest, its stake is worth ~$5B after tax
Alibaba IPO valuation - $162.7B
Divestment of 121.7m shares in Alibaba in the IPO at $66 (after 35% tax) - $5.2B
401.8m shares of Alibaba post-IPO at $66 - $26.5B
Assuming
1) Yahoo dispose Alibaba in the future at 15% tax rate
2) Alibaba's share price increases by 20%
I value Yahoo stake in Alibaba post-IPO at $27B
Yahoo cash & marketable securities - $4.3B
Yahoo FCF for 2qFY14 - $186m
est FY14 FCF - $744m
If Yahoo is valued at 7x FCF - $5B
My valuation of Yahoo now is $46.5B.
(vested)
Alibaba could add billions to its valuation with one simple move
Chinese ecommerce giant could increase price range of IPO shares as it prepares to close order book due to high investor demand
Alibaba is expected to close the order books on its record-breaking initial public offering early after high demand from investors.
The Chinese ecommerce giant, which is planning to float in the US this month, is confident it will sell all the shares offered to the market at the upper end of the $60 to $66-a-share price range, sources told The Telegraph.
The level of interest suggests that Alibaba’s banks could increase the this range, netting the 15-year-old company substantially more than the $24.3bn (£15bn) it is looking for. Even at this level it would be the largest tech IPO in history, valuing Alibaba at up to $167bn.
Alibaba’s banks, including Goldman Sachs, Credit Suisse and Deutsche Bank, will stop taking orders from investors in Asia on Wednesday, a day earlier than expected.
A final price for the shares is still expected to be set on Thursday.
At market cap of $167b, it is much much higher than my initial valuation of $120b.
As of 5 Feb 2014
Market cap of Yahoo! - $42.65B
Market cap of Yahoo! Japan - $22.0B using USD/JPY 107.3. Since Yahoo has a 35% equity interest, its stake is worth ~$5B after tax
Alibaba IPO valuation - $162.7B
Divestment of 121.7m shares in Alibaba in the IPO at $66 (after 35% tax) - $5.2B
401.8m shares of Alibaba post-IPO at $66 - $26.5B
Assuming
1) Yahoo dispose Alibaba in the future at 15% tax rate
2) Alibaba's share price increases by 20%
I value Yahoo stake in Alibaba post-IPO at $27B
Yahoo cash & marketable securities - $4.3B
Yahoo FCF for 2qFY14 - $186m
est FY14 FCF - $744m
If Yahoo is valued at 7x FCF - $5B
My valuation of Yahoo now is $46.5B.
(vested)