According to two ex-Alibaba Group employees I’ve spoken with this week, Alibaba’s shares are now being exchanged privately valuing the company at $50 billion. It appears that the company itself is the major buyer of such shares when ex-employees want to cash them in, although I can’t confirm that.
According to one ex-employee I spoke to, none of the former employees he knows is interested in selling their Alibaba shares because “they believe an IPO is imminent.”
Value may not go up. You are assuming the growth rates will remain constant or increase. That is foolish to count on. If growth starts slowing this thing will be worth a lot less. They should IPO now! Not gamble. Markets are hot in Asia now. Who know in two years. Also they will be forced to IPO by then and anything could happen. Better to do it when optimism is high. Don't gamble! I believe if they do there will be a lot of shoulda, coulda,woulda talk after the fact.
If Alibaba holds off on IPO’ing until late next year, and it’s worth $78 billion, Yahoo’s stake would be worth $11.2 billion or $10.21 a share (although probably much more given the aggressive share buybacks that are going on with the cash from tranche one’s sale).
As the Fram Oil guy used to say, “you can pay me now or pay me later…”