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Alibaba Group (9988.HK), the Chinese e-commerce giant, is planning to raise USD 5 billion through a multi-tranche bond deal in U.S. dollars and offshore Chinese yuan, according to two individuals familiar with the matter.
Image Source: Barron’s
In a regulatory filing on Monday, Alibaba confirmed its intention to pursue the transaction, with the exact size, interest rates, and maturity terms to be finalized as the process unfolds.
The proposed dollar tranche includes bonds with maturities of 5.5, 10.5, and 30 years, as outlined in a term sheet reviewed by Reuters. Meanwhile, the offshore yuan tranche is expected to feature 3.5, 5, 10, and 20-year bonds, according to the document.
Banks working on the deal have informed potential investors that Alibaba’s target is to raise USD 5 billion, the sources said. However, due to the confidential nature of the information, the sources requested anonymity.
Alibaba explained in its filing that the proceeds from the bond issuance would be used for general corporate purposes, including repaying debt and financing its share buyback program.
This bond issuance reflects Alibaba’s strategy to strengthen its financial footing while managing its capital structure effectively in an increasingly complex market environment.
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