Alibaba Group Holding Ltd. (BABA)’s initial public offering became the biggest ever at $25 billion, after bankers exercised an option to boost the deal size by 15 percent on strong demand.
As told by a private person who chose to remain anonymous, the underwriters exercised a so-called greenshoe option to sell an additional 48 million American depositary shares. Credit Suisse Group AG, Deutsche Bank AG, Goldman Sachs Group Inc., JPMorgan Chase & Co., Morgan Stanley and Citigroup Inc. managed the offering.
Shares of Alibaba soared 38 percent on their Friday trading debut, the biggest first-day jump for an IPO of at least $10 billion. The company marketed the offering at a discount to its Chinese peers, attracting interest from money managers including Fidelity Investments, BlackRock Inc. and T. Rowe Price Group Inc. who each asked for at least $1 billion of shares, people familiar with the matter said last week.
Alibaba, led by billionaire chairman Jack Ma, has profited from China’s burgeoning consumer class by dominating the e-commerce industry in the country of 1.36 billion people. It surpassed Facebook Inc. (FB) by market capitalization from the minute it started trading and closed with a valuation of $231.4 billion, making it larger than Amazon.com Inc. and EBay Inc. combined.