The Costs of a $24 Billion Public Offering

Wonder what a large (indeed the largest) public offering costs?

Well, there are the investment banking fees.  According to the F-1 filed by Alibaba:


     Per ADS      Total  

Price to public

   US$ 68.00         US$ 21,767,214,800   

Underwriting discounts and commissions

   US$ 0.816       US$ 261,206,578   

Proceeds, before expenses, to us

   US$ 67.184       US$ 8,268,800,532   

Proceeds, before expenses, to the selling shareholders

   US$ 67.184       US$ 13,237,207,690   


Of course, that wasn't the only amount made by the underwriters.  They received a greenshoe of  48,015,900 American Depository Shares.  Given the 37% increase in share prices on the opening day, it is possible that the underwriters earned more unloading this additional allotment than from their fees for the entire offering.

Underwriters were not the only ones who did well by Alibaba. Expenses or billings for lawyers for the Company topped $15 million.  Even the SEC scored a $3 milllion plus fee (more than the $2.6 million recently assessed against 33 violaters of the beneficial ownership reporting requirements).  The NYSE earned a $250,000 fee and even FINRA got into the act, charging a filing fee of $225,500.  The full table is below. 

All and all, it was a good day for Wall Street and a good day for deficit reduction.   


SEC registration fee

   US$ 3,224,160   

New York Stock Exchange listing fee


Financial Industry Regulatory Authority filing fee


Printing and engraving expenses


Independent financial advisory fees and expenses


Legal fees and expenses


Accounting fees and expenses








   US$ 49,666,828   




"These expenses will be borne by us, except for underwriting discounts and commissions, which will be borne by us and the selling shareholders in proportion to the numbers of ADSs sold in the offering by us and the selling shareholders, respectively."





J Robert Brown Jr.