Alibaba bets 80 billion Hong Kong dollars on AI! Secures nearly 3x oversubscription

Alibaba announced on August 24 that it had completed the pricing of a new share placement of HK$80 billion (approximately US$10.2 billion), with the net proceeds to be 100% invested in full-stack AI capabilities and strengthening AI infrastructure construction.

According to sources close to the transaction, the placement received nearly 3 times oversubscription, exceeding HK$200 billion. Sovereign and long-term funds accounted for over 40% of the final subscription, reflecting strong response and high-quality order book.

Alibaba's clearly visible return path for AI investment has earned the trust of global long-term capital in this placement. Major sovereign funds from the Middle East, Europe, and Asia all actively participated in the subscription.

The announcement shows that CICC, HSBC, Morgan Stanley, and UBS served as joint global coordinators, joint bookrunners, and joint placement agents for this new share placement, with Barclays, Citigroup, and JPMorgan as joint bookrunners.

Notably, according to the latest information from the Hong Kong Stock Exchange, following Alibaba's announcement of the HK$80 billion new share placement plan, Group Chairman Joe Tsai and CEO Eddie Wu increased their holdings by a combined approximately HK$120 million in Alibaba shares, casting a vote of confidence in the company's AI strategy.

Specifically, Joe Tsai purchased 720,000 Hong Kong-listed Alibaba shares at an average price of approximately HK$112, spending about HK$80 million; Eddie Wu purchased 350,000 shares at an average price of approximately HK$111.6, spending about HK$40 million. Together, they increased their holdings by 1.07 million Hong Kong-listed shares, with a total investment of approximately HK$120 million.

Public data shows that Alibaba has been continuously increasing AI investment in recent years, building a full-stack AI layout covering computing power, chips, models, and applications.

The latest financial report shows that Alibaba's AI-related products have surpassed RMB 49.5 billion in annualized revenue, expected to reach US$10 billion next quarter, with Alibaba Cloud's external commercialization revenue projected to reach US$100 billion by 2030 at a 20% profit margin. Management expects AI capital expenditure to be recovered within 2 to 3 years.

Meanwhile, over the past few years, Alibaba has cumulatively repurchased and canceled approximately 11% of its shares to enhance shareholder returns.