Alibaba shares trading 7.7% higher in Hong Kong debut

HONG KONG (Reuters) – Alibaba Group’s (BABA.N)(9988.HK) Hong Kong shares were trading 7.7% higher at HK$189.50 in their debut, after marking the city’s biggest share sale in nine years. Alibaba has raised at least $11.3 billion from the secondary listing and that amount could climb to as much as $12.9 billion if an over-allotment option is exercised. At Tuesday’s listing ceremony, CEO Daniel Zhang noted Alibaba’s Hong Kong debut had been a long time coming.

“Thank you Hong Kong and thank you HKEX. Your reform in the past few years has made it possible for us to realize what we missed five years ago,” Zhang said.

Alibaba had hoped to initially list in Hong Kong, but eventually chose New York for its record-breaking $25 billion initial public offering in 2014 after its unusual governance structure failed to win acceptance from Hong Kong regulators.

Alibaba is the fifth most-traded company in New York this year, averaging $2.6 billion a day, according to Refinitiv data.

The company sold its Hong Kong shares at HK$176, which was a 2.9% discount to the company’s closing price in New York last Tuesday. Each American Depository Receipt (ADR) represents eight Hong Kong shares.

The broader Hong Kong market was up 0.5% on Tuesday.