Alibaba Completes $8bn Bond Offering Amid Robust Demand

Chinese e-commerce major Alibaba has successfully completed its first ever bond offering, raising billions of dollars from investors.

Bloomberg reported that the company raised $8bn (€6.4bn, £5.1bn), after investors submitted orders of at least $57bn. The company, which has capitalised on ultra-low US borrowing costs, sold bonds at yields that were lower than originally offered due to the robust demand.

The offering was led by Morgan Stanley, Citigroup, Deutsche Bank and JPMorgan. Maturities of the notes, offered in six tranches, ranged between three years and 20 years.

The bond sale has been the largest dollar denominated offering by an Asian company, according to Bloomberg data. It was also the largest debut corporate bond issue on record, surpassing Intel's $5bn debut issue in September 2011, according to data provider Dealogic.

Alibaba, which raised a record $25bn in an initial public offering (IPO) in September, will use proceeds to refinance some credit agreements, the company said earlier.

The offering reflects strong interest among US investors for the Chinese company, which received high credit rating from agencies Moody's, Standard & Poor's and Fitch due to its high profitability and growth potential.

The company earlier said its online sales volume would exceed the global sales volume of US retail giant Walmart in two years.

In September, Alibaba conducted the largest-ever stock offering in the US. The IPO was priced at $68 a share and the price rose to sky-high levels since the offering.

Alibaba shares closed on 20 November trading up 1% at $109.82, raising its market capitalisation at over $265bn, which is more than the combined stock market value of its US rivals Amazon and eBay.

After completing its mammoth IPO in the US, the e-commerce company is looking for a multi-faceted expansion. The company's plan involves reaching billions of consumers within China and expanding its presence across the globe.