By Senad Karaahmetovic
Shares of Alibaba (NYSE:BABA) are up about 5% in premarket Tuesday after the Chinese e-commerce giant said it will apply for a primary listing on the Hong Kong Stock Exchange.
If approved, Alibaba will become dual-primary listed on the New York Stock Exchange and Hong Kong Stock Exchange, the company said in a press release. Alibaba expects to complete the primary listing process before the end of this year.
Shares of Alibaba have a secondary listing status in Hong Kong at the moment.
“We have received approval from the Board to apply to add Hong Kong as another primary listing venue, in the hopes of fostering a wider and more diversified investor base to share in Alibaba’s growth and future, especially from China and other markets in Asia,” said Alibaba Group Chairman and Chief Executive Officer Daniel Zhang.
“Hong Kong and New York are both major global financial centers, with shared characteristics of openness and diversity. Hong Kong is also the launch pad for Alibaba’s globalization strategy, and we are fully confident in China’s economy and future.”
The company said that the average daily trading volume in Hong Kong for its shares was approximately $0.7 billion compared to $3.2 billion in New York.
“Given the substantial presence of its business operations in Greater China, the Company expects that a dual-primary listing status would allow it to broaden its investor base and facilitate incremental liquidity, in particular, expand access to China- and other Asia-based investors,” Alibaba added in the statement.