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When Investors Buy Alibaba Shares, They Won't Get What They Paid For

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When Investors Buy Alibaba Shares, They Won't Get What They Paid For

When Investors Buy Alibaba Shares, They Won't Get What They Paid For

When Investors Buy Alibaba Shares, They Won't Get What They Paid For

  • Download
  • <iframe src="https://www.npr.org/player/embed/348010275/348010279" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
  • Transcript

When the Chinese e-commerce company Alibaba goes public, it's going to the biggest public offering ever. When investors buy their shares, however, they won't be buying an ownership stake in Ali Baba's profitable websites. Instead, they will be buying shares in a holding company based in the Cayman Islands. It's illegal for Chinese Internet companies to accept investment from outside the country, but Alibaba has found an ingenious way to still get the $20 billion they want from outside investors.