China's Alibaba launches the biggest IPO ever but financial advisers say they're not getting many inquiries from retail investors. Fred Katayama reports.
It's not a household name in America, but Alibaba could become the hottest IPO since Facebook and possibly the biggest ever. The e-commerce company that dominates online retail sales in China kicked off its roadshow in New York today. Some investors who can't wait bought shares of Yahoo this morning. Yahoo owns more than one-fifth of Alibaba, and it has pledged to pay its shareholders at least half of the proceeds from the public offering. The highly profitable company Jack Ma founded sells more than Amazon and ebay combined. Alibaba could raise more than $21 billion. It initially priced its shares at a level that values itself at around $163 billion, that's roughly the worth of Amazon.com. But despite the superlatives, the IPO may not draw much interest from small investors. Some financial advisers say many people just don't know who Alibaba is, and those who do may be leery of investing in a Chinese company, so advisers are not getting many inquiries. IPO expert Tom Taulli said, "Because it is such a large deal and you aren't going to see a lot of retail investor interest, I do not think it's going to have a lot of retail momentum when it gets out of the gate." Alibaba executives will visit other U.S. cities before heading abroad. The stock is reportedly expected to begin trading on the New York Stock Exchange September 19.