SINGAPORE: Singapore state funds bought US$1 billion of shares in Chinese e-commerce company Alibaba Group Holding Ltd as part of an US$8.9 billion sale by its biggest shareholder, Japan’s SoftBank Group Corp, the company said on Wednesday.
Singapore sovereign wealth fund GIC Pte Ltd and state investor Temasek Holdings Pte each purchased US$500 million of Alibaba shares at US$74 per share through subsidiaries, Alibaba said, offering details of the SoftBank sale announced on Tuesday.
GIC and Temasek confirmed the transactions, but declined to provide further comment. Temasek is an existing investor in Alibaba.
“The purchase shows that GIC and Temasek are still confident about China’s economy and the rise of e-commerce and technology in the country,” Margaret Yang , a market analyst at CMC Markets in Singapore, told Bloomberg News. “It’s going to boost the national interest of Singapore in e-commerce in China and also in Southeast Asia.”
Alibaba purchased US$2 billion of its own stock at the same price, in a move that would add to earnings, executive vice chairman Joe Tsai told analysts on a call.
Members of the Alibaba Partnership of senior executives and founders purchased another US$400 million, as expected, at the US$74 per share price, he added.
SoftBank also offered US$5.5 billion in debt securities, which can be exchanged for Alibaba stock in three years, Tsai said.
SoftBank on Tuesday said it would sell at least US$7.9 billion of shares in Alibaba to cut the Japanese company’s debt, adding that it would remain Alibaba’s largest shareholder after the sale.
Alibaba shares fell about 6.5 percent to US$76.69 at the close of trading in New York on Wednesday.
