LIke I said, talking heads are talking.
we know you are a coldone's id as well as argentinedeep. we are not as dumb as you are.
It is about assets after all....asian, internet, contents, users..
Alibaba will sell 300 mil shares, Softbank will sell 150 mil shares, Yahoo will sell 140 mil shares, other partners will sell 50 mil. for a total offering of approx. 640 million shares on IPO day. No secondary offering.
What I'm saying is Alibaba will raise between $20-$26B. The market cap at IPO price of $70 a share is $183 Billion. But, may trade up 20% on the first day to $84 resulting in market cap of $218 Billion, which is in the range bandied about.
Softbank has previously indicated that they will not sell any shares. No way this is true, Softbank needs to raise funds to pay down debt. to allay some of the investors criticism that Softbank is overly leveraged especially with their acquisition of Tmoble.
Talking heads are prognosticating that the Alibaba valuation will be less than anticipated, therefore, baba will need to sell more shares to raise the $20 - $26B rumored amount. I believe this reasoning is misplaced.
Here is my take:
Alibaba intends to limit the total amount of shares sold. Therefore, Softbank, who has indicated they will not sell any shares, will be selling shares to make up more than the 60 mil. shares that Yahoo is not selling. Why? Softbank need the money to pay down debt. and for acquisitions. Softbank will sell 150 mil. shares.
I've always opined that Alibaba will sell new shares of around 300,000,000 million for $70 shares resulting in a proceed of $22.4 Billion, subtract underwriting fees and you are in the ballpark of $20Billion. You multiply $70 x total oustanding shares of 2,620,000,000 and you get $183.4 Billion Alibaba valuation which is in the range bandied about of $150 - $200 Billion.
One more thing, 2016 Earnings at 30% annual growth rate form 2014 earnings of $3.75 Billion = $6.34B. Slap a reasonable PE of 35 = $222 Billion. Once again it matches up with most of the Analyst estimate. Bottom line, the above calculations IMHO is what's going to go down.
My Pick on the Acquirer and WHY:
1. CMCSA - Already has relationship in sports and finance. It is about competition for distribution/consumption on TV and Mobile, NBC can use Yahoo for live streaming of their sports events as well as another venue channel for past and cancelled programs. Also, it is all about contents outside of TV programming.
2. Google can use Yahoo to expand it advertising real estate and acquire Yahoo exclusive publishing relationships. They will also get Marissa Mayer and Yahoo's live streaming technology to monetize You Tube.
Talking heads will focus on a profitable company, with good internet asset and valuable Asian asset as the catalyst for a buyout. Just you watch and see. I give it 12-18 months post IPO.
Your credibility sucks or should I say you are a liar. Yahoo is selling up to 208 million Alibaba shares on IPO day. Yahoo agreed to sell 50% of their 40% ownership of Alibaba in 2012 to make way for the IPO. She definitely bought Dan Loeb share, but at a very very good price of $27...Yahoo shares are priced today at $35.50, Marissa scored multiple touch downs on this. She spent the rest of the money buying back stock and improving mobile capability...Geez, she's only been there 2 yrs. At least she is doing something that is turning Yahoo around, AND she has the support of Silicon Vally by the way. The previous 4 CEOs just sat on their hands and cut cost.
If you are so smart, what would you have done with the money and what will you do with the ALI IPO money? Come on Einstein we await your reply.
Msft tried to buy Yahoo. Then Alibaba became valuable. Post Alibaba IPO Yahoo maybe a slow growth with huge potential in vide streaming, but has huge contents and has many partnerships. Marissa see the writing on the wall and sell Yahoo. Mariissa makes a ton of money for her 3 yrs. tenure at Yahoo. Most importantly, she has earned the CEO title and can get another CEO job. BUT, google could also hire her back to head up You Tube to achieve its potential.
post IPO. Music radio everyday is mentioning Yahoo LIve 365 day free concert. Here are my lineup for who would be interested in Yahoo for not only their Asian asset that can be spun off, but for their valuable live streaming capability and eyeballs for "distribution/consumption" by major media/tv companies as well as undervalue play.
1. CMCSA - Distribution/Consumption growth expansion opportunity
2. ATT - Distribution/Consumption growth expansion opp.
3. Google - Outside or search, Google is not growing. Google can get Marissa back to head up their video (You Tube) and expand their offering for live streaming of anything from sports, events, etc. Would gain relationship with CMCSA as Yahoo has relationship with them thru sports and finance already. No anti-trust issue with search, as Yahoo can sell that to MSFT.
4. Private Equity - Sum of the Parts valuation. Take Yahoo private, spin off the Asian asset, Grow the core or Sell it piece by piece.
5. What would Jerry Yang and Jack Ma think of Yahoo. How would Yahoo fit in Alibaba's quest for international expansion? Yahoo has a valuable internet real estate that is very enticing for CMCSA, ATT, so why not BABA/Sprint/Yahoo partnership since they already have relationships.
FYI, I have trading account and core account. Trading account can be sold and bought in any given day or any given hour depending on the market and stock movement.
MM is smart enough not to buy overpriced companies. Like she said, "good steward" of the money. I believe her. I think she will distribute some of the money to shareholders, do some buybacks, do small acquisition in mobile/video.....then BAMMMMMMMM! She sells the company to CMCSA. Then BAMMMMMM! rumors hit of competing bids.
$1B does not make sense. They have over $5B in Cash. OR put it another way, if they want only $10B, they can raise that in the credit market, like they did when they raised $8B.
If you were MM or Ken, wouldn't you be on your hands and knees? Also, wouldn't you be asking Jerry Yang, who still owns Yahoo shares, to help you in this quest? (David Filo is still a Yahoo Board member). Also, if you were Mr. Son, (Sprint, Tmobile, etc.) would't you be looking in the future where ATT is buying Direct TV and CMCSA merging with Time Warner Cable and Son is a smart man, all of these activities point to a battle for distribution/consumption not only for tv, but in the growth area of mobile. Baba has been buying internet real estate in China, i.e. weibo, youku tudo, ucweb, autonavi, etc., etc. so companies are expanding beyond tv and desktop to mobile as mobile is the future. So if you want to expand into mobile streaming, especially live, guess what company can offer that opportunity for you, FB? nope, not for sale, Google, nope, you tube is not organized. Yahoo is the future for mobile, period. AND Yahoo is buying high tech to be the best in mobile video. So Ma, Son and Yahoo already has relationships, don't you think they would want to keep that relationship and even expand it for their future endeavors?
You don't get it again. Let me explain:
1. This undertaking is underwritten by advertisers, i.e. Kellog. Per Rapino, the CEO of Live Nation, it is already fully subscribed, meaning the advertisers all lined up to cough up the dough.
2. The buzz from the buzz from the buzz with friends spreading the buzz WILL increase Yahoo users and engagement (time spent) on Yahoo sites, meaning PRICELESS.
3. Live Nation working with Yahoo for it "scale" means HUGE for Yahoo because the live streaming video industry is getting much much bigger and getting more attention. Meaning if you are a company that want to do "scale" for your live streaming in the internet via mobile or tv, and you have a project or event, i.e. sport, concert, festival, convention, etc. etc. and you want to reach a vast audience and you want someone that can do it professionally with the latest technology, you think of, who else, Yahoo. BTW, this undertaking with live nation will give Yahoo so much experience, it is, wait for it............ PRICELESS.
Radio music station all around the country are mentioning this NEWS in the air. I heard it just yesterday on my music radio. Friends telling Friends telling Friends....PRICELESS.
Can you say, people will rediscover Yahoo.