Alibaba IPO Scheduled for Week Beginning Sept 8

Alibaba Holdings Ltd., the Chinese e-commerce and web business giant, plans to launch its U.S. Initial Public Offering in the week beginning Sept. 08, 2014. Shares of the company may begin trading by Sept. 18 or 19 on the New York Stock Exchange under the symbol BABA.

The Wall Street Journal broke news of the much-anticipated IPO citing some insider sources who told the publication that the company was wrapping up its month-long talks with the U.S. regulators.

Alibaba had initially planned on launching the IPO in August but pushed the date back to September because some investors were on a vacation and the company also needed further regulatory approval from the U.S. But experts believe the extension was for the better.

"There shouldn't be any obstacles for proceeding with the IPO," Li Muzhi, a Hong Kong-based analyst at Arete Research Service LLP told Bloomberg.

 "This just gives them a bit more time."

Alibaba first filed for an IPO in May ad announced that it expects to raise about $1 billion on its first trading day. However, the hype about its launch has caught investors attention and analysts predict that the IPO could raise as much as $20 billion and could become the largest offering in U.S. history.

Investors are eagerly waiting for the IPO because Alibaba holds 80 percent of the e-commerce market share in China. By investing in the shares, businessmen hope to tap the large e-business sector of China.

"If it is able to transport that kind of power to outside China, it has the potential to become a true global ecommerce powerhouse. Everybody thought Amazon could do it but now we have to rethink Amazon in the light of being the most successful company in that field in the U.S. -- but not in the world," Roger Entner, Lead Analyst and Founder of Recon Analytics told Reuters in an earlier interview.

According to the Economic Times, Alibaba's business will be controlled by a "Variable Interest Entity" wherein foreign companies get to invest in the business but their ownership is limited as per certain conditions.

"The VIE structure is the only way at present to play this game," Paul Gillis, a professor at Peking University's Guanghua School of Management told The Economic Times. "So if you want to invest in restricted sectors of China's economy, you have to get comfortable with the VIE structure."

The experts explained that Alibaba has one of the most transparent and simplest VIE structures among internet companies, which could be the reason for the immense demand and anticipation surrounding the IPO.