Alibaba plans to sell up to $5 billion worth of bonds

Alibaba Group Holding Ltd. plans to sell billions of dollars worth of bonds, which will test investors’ appetite.Alibaba said in a brief statement late Tuesday that it plans to issue dollar loans, including some bonds, to finance stabilization projects subject to market conditions. It said the total size of the agreement was not determined, nor were the bonds maturity, interest rates or other conditions.

According to a notice sent to investors by one of the banks handling the sale, the deal could total up to billion 5 billion, including bonds with a maturity of 40 years. The message was sent to Hong Kong on Wednesday morning and was seen by the Wall Street Journal.

Shares of Alibaba have risen sharply in recent months, following a speech by founder Jack Ma in October that prompted Chinese President Xi Jinping to cancel the company’s blockchain listing of financial technology chat group ۔

In December, Chinese authorities launched a no-confidence motion against Alibaba and fined it, misleading consumers by increasing product prices to rivals. Mr Ma has largely disappeared from public life, but reappeared in January after helping expand Alibaba’s reach in the form of a video.

On Tuesday, Alibaba predicted that beating quarterly results, revenue rose 52 percent to .3 12.3 billion, as sales rose 37 percent. Chief executive Daniel Zhang told investors that in response to the no-confidence inquiry, Alibaba had set up a task force to review some of its businesses, and said it was ready to take on more social responsibility.

Alibaba has borrowed heavily from international bond markets. It sold 8 8 billion worth of bonds in 2014, the same year it went public on the New York Stock Exchange, and 2017 7 billion in debt in 2017.

In recent years, Alibaba’s bonds have generally risen in value as part of a broader market rally, boosting yields and effectively reducing the cost of any new borrowing for Alibaba. Are

However, there has been some increase in yields in recent months as benchmark Treasury bonds have risen, and as Alibaba has faced other challenges. Yields on Alibaba’s 2027 bonds fell to less than 1.3 percent in August, from about 2.1 percent in January. He gained 1.73% on Tuesday.

Alibaba has a solid rating on investment grade, with A1 rating for Moody’s Investors Service and A + grade similar to Fitch Ratings and S&P Global Ratings.

Citigroup units,

Credit Suisse,

Morgan Stanley,

JPMorgan and China International Capital Corporation

There are buyers for bond sales.

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