On November 20, 2024, Alibaba Group Holding successfully raised US$5 billion through a dual-currency bond offering, marking the largest corporate bond issuance in the Asia-Pacific region this year. The offering comprised US$2.65 billion in US dollar-denominated notes and 17 billion yuan (approximately US$2.35 billion) in offshore yuan-denominated notes. The proceeds from this bond issue will be allocated for general corporate purposes, including debt repayment and share buy-backs, as the company seeks to stabilize its financial position amidst a significant decline in its stock value, which has dropped 70% from its peak in 2020. [2039aae5]
The US dollar notes were structured into three tranches maturing in 2030, 2035, and 2054, while the yuan-denominated notes included four tranches with maturities ranging from 2028 to 2044. The offering was met with strong market demand, being oversubscribed multiple times, indicating investor confidence in Alibaba despite its recent challenges. The company has also engaged in substantial share buy-backs, totaling US$14.7 billion in 2024, as part of its strategy to enhance shareholder value. [2039aae5]
This bond issuance comes at a time when Chinese Vice-Premier He Lifeng has reiterated the government's support for Hong Kong as an offshore yuan hub, further solidifying the city's status in global finance. The successful completion of Alibaba's bond offering not only boosts the company's liquidity but also reinforces Hong Kong's position as a key player in the international financial market. [2039aae5]
In the broader context, dollar bond sales in Asia have faced challenges, with issuance down 28% compared to the previous year as borrowers seek cheaper financing options domestically. However, Alibaba's significant bond offering stands out as a beacon of resilience in the current economic landscape. [f11267e5] [2ec67b8c]