Taiwanese Insurer Fubon Life To Invest Up To $500m In Alibabas HK Listing

Fubon Life Insurance, an insurance unit of Taiwanese financial conglomerate Fubon Financial, Monday said that it plans to spend up to $500 million to purchase Alibaba Group’s new shares when Asia’s most valuable company lists in Hong Kong.

The Taipei-based insurer said in a statement that it is positive about Alibaba’s development and would unveil the exact amount of its investment after the e-commerce giant sets the pricing term for institutional shareholders today, or no later than November 25. Alibaba aims to start trading on the Hong Kong stock exchange on November 26.

Fubon Life did not update the investment amount when we published the article.

The transaction, once proceeded, would become Fubon Life’s second investment in Alibaba after buying about $20 million of shares during its initial public offering (IPO) in New York in 2014.

The Hangzhou-based company first went public in the United States after raising $25 billion in what remains the world’s largest IPO.

Alibaba, which will float shares in Hong Kong under the symbol “9988,” is offering 500 million shares in the secondary listing plan, allocating 12.5 million to retail investors in Hong Kong and 487.5 million to international investors. Based on the indicative ceiling of HK$188 ($24.02) apiece set by the firm last week, Alibaba could raise as much as HK$101.2 billion ($13 billion) if the full allocation of 575 million shares is taken up.

The up-to-$500-million investment proposed by Fubon Life could account for 3.85 per cent of the offering.

Alibaba’s secondary listing plan is expected to give Hong Kong a shot in the arm amid months of violent confrontations between police and anti-government protestors in the financial hub. The size of the offering will push the local bourse to surpass the New York stock exchange and Nasdaq to top the global IPO ranking list in 2019.

Founded in 1993, Fubon Life has recorded NT$197.8 billion ($6.5 billion) in overseas securities investment as of June 30, 2019, up 3 per cent from a year earlier, according to company data. Foreign securities accounted for 5.1 per cent of its total investment, followed by foreign bonds at 54.2 per cent, domestic bonds at 14.5 per cent and domestic securities at 9.6 per cent, as per the data.

The parent company, Fubon Financial, will release the latest information at an investor conference scheduled on Friday.