Alibaba Hikes IPO Price Range To $66-$68 From $60-$66

Chinese e-commerce giant Alibaba Group Holding (NYSE: BABA) increased the price range of its initial public offering scheduled to launch on Friday, Sept 19. The new price range of $66 to $68 from the previous $60 to $66 is an indicator of the strong demand for shares of the e-commerce portal founded by former teacher Jack Ma.

With the adjusted higher IPO price range, Alibaba could raise about $22 billion if the underwriters would exercise the option to sell additional shares to meet demand and would likely surpass the $22.1billion record set by the Agricultural Bank of China in 2010, reports the Irish Independent.

The daily attributed the expected high demand for Alibaba shares to the roadshow of the IPO last week which kicked off in New York. Although the Chinese firm could still hike its indicated range, it would keep the final price investor-friendly.

Demand has been overwhelming since the launch ... Increasing the price range was already on the cards from the beginning," the daily quoted its unidentified source.

Reports said that Alibaba would close its IPO order book early when it has received enough offers to sell all 320 million shares.

Alibaba could even eat into the market shares of American e-commerce giants eBay and Amazon since founder Ma said on Monday that it plans to expand its business in the US and Europe. Ma said, "After being listed in the U.S., we will develop our business in Europe and in the U.S."

However, he said at the investor luncheon at the Ritz Carlton hotel, "We will not give up the Asia market because, as I would say, we are not a company from China, we are an Internet company that happened to be in China."

While the IPO launch date is known, the exact time when trading would begin is unknown because the NYSE delays the opening of IPO shares depending on the underwriter that leads the offering and how hot is the share.

The general rule is that IPOs start to trade at NYSE at 9:15 am, but hot IPOs trade a little bit later like the General Motors IPO that began trading at 9:36 am and Twitter at 10:49 am.

Besides the size of the Alibaba IPO and the interest around the shares, lead underwriter Goldman Sachs also has a history of late IPO trading. Fortune predicted Alibaba shares would begin trading at 11 am on Friday.

NYSE President Tom Farley told Fortune, "What's great about the NYSE is that it's not all about technology and that at a moment in time a stock has to open up ... We have humans at the point of sale who can make rational decisions. And one rational decision is, 'this is a big IPO, feels like a bit of an imbalance, let's slow it down a bit.'"

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