Alibaba Group Holding Limited has unveiled plans to raise approximately HK$12 billion through a private offering of zero coupon exchangeable bonds, linked to its subsidiary Alibaba Health Information Technology Limited. The bonds, which mature in 2032, will be offered to select non-U.S. investors outside the United States under Regulation S of the U.S. Securities Act.

These unsecured and unsubordinated bonds will not carry interest and may be exchanged for Alibaba Health shares, cash, or a combination of both, based on terms set at issuance. Bondholders can opt to convert their bonds from the 41st day after issuance up to five trading days before maturity.

Alibaba Health, listed on the Hong Kong Stock Exchange (HKEX: 00241), is a key healthcare platform in Alibaba’s ecosystem. The group holds a 64% equity stake in the company and plans to maintain its controlling interest post-issuance. Alibaba reaffirmed its commitment to deepening its “AI + Healthcare” strategy alongside Alibaba Health.

Proceeds from the offering will be directed toward general corporate purposes, including expanding cloud infrastructure and growing international commerce operations.

As part of the offering, investors may engage in hedging strategies such as short selling Alibaba Health shares or entering into related derivative positions. To support this, Alibaba has arranged a Delta Placement, where a subsidiary will lend Alibaba Health shares to facilitate hedging by institutional investors via bookrunners.

These securities, including the bonds and any Alibaba Health shares issued upon exchange, will not be registered under U.S. securities laws and cannot be sold within the United States without proper registration or exemption.

While the bond issuance and associated Delta Placement are subject to market conditions, Alibaba has emphasized that no assurance can be given regarding their completion.

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News Source: Businesswire.com