Jack Ma is rewriting the rules of capitalism
Donald Gasper says the HK stock exchange is right to rethink its ban on dual share classes - the governance structure chosen by Alibaba and other tech giants so they are not beholden to the demands of short-term investors
It's official: the initial public offering last week of Alibaba Group now ranks as the world's largest IPO, having raised US$25 billion. This came about after the company, now one of the biggest publicly traded technology firms in the world, agreed to sell an additional 48 million shares by exercising the so-called "green shoe" overallotment option.
This really marks a significant milestone, not just for Alibaba but for Chinese businesses in general and for e-commerce worldwide.
Unfortunately, due to its outdated listing rules, which exclude companies with dual-share structures, Hong Kong lost the opportunity to become the location of the IPO and runs the risk of being left behind as more internet-based companies seek to raise capital.
This is why, earlier this month, the carried an article that asked, pointedly, how many Alibabas is the Hong Kong exchange "prepared to lose for the sake of its one-share-one-vote principle"?
Fortunately, as it noted, the HKEx has quietly published a paper looking at the argument that it should update its archaic listing rules.
It might be a case of closing the stable door after the horse has bolted, but such a willingness to face reality deserves to be saluted.
