Mar 11, 2016

    Alibaba takes $4.1b loan for future buys


    CHINA'S Alibaba Group Holding yesterday said it has signed a deal for a US$3 billion (S$4.1 billion) five-year loan, which will help the e-commerce giant as it snaps up stakes in companies within China and overseas.

    Alibaba, led by founder Jack Ma, has been expanding in areas beyond its core e-commerce base, such as online video, as volume growth in its online shopping business slows.

    The firm said in a filing to the United States Securities and Exchange Commission that it had signed the syndicated loan deal with a group of eight lead arrangers.

    It added that the amount could increase if there was steep demand.

    Alibaba said the loan would be used for "general corporate purposes", without expanding on what this meant.

    A China-based Alibaba spokesman declined to comment further.

    The US-listed firm has been on something of a spending spree of late.

    Its capital expenditure in the last three months of last year was 4.9 billion yuan (S$1 billion), more than triple the level in the same period in 2014.

    Thomson Reuters LPC, which reports on global loan markets, cited sources on Tuesday saying Alibaba had mandated eight banks for a bullet loan of US$3 billion to US$4 billion.

    The sources said ANZ, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, JP Morgan, Mizuho Bank and Morgan Stanley were the mandated lead arrangers and bookrunners on the loan.

    The Wall Street Journal cited sources last month saying Alibaba was in talks with several banks to borrow up to US$4 billion to fund expansion, including acquisitions.