Write a summary report of an IPO story. You can choose one of the largest IPO in

Question

Write a summary report of an IPO story. You can choose one of the largest IPO in the US history(http://www.forbes.com/pictures/eddk45ggekg/the-biggest-ipos-in-u-s-history-6/), or pick your own favorite company. Search for the investment bank(s) involved, their IPO price, 1-day, 1-month, and 1-yr stock performance after the IPO, and their current stock price and total market capitalization. Please use your own words and describe the investment bank(s) involved their price, current stock price and total market capitalization as much as you can. If you are not sure about the answer please leave it empty.

Thank you

Explanation / Answer

Summary Report of Alibaba IPO [the biggest IPO in U.S.A. capital market history]

i. Founders of Alibaba.com, the Chinese e-Commerce giant: Jack Ma and Peng Lei founded the company in April 1999

ii. Business: e-Commerce webiste providing C to C, B to C and B to B sales service via web portals

iii. IPO Price per equity share: $68 per share

iv. IPO proceeds amount: $21.80 billion and $25 billion post exercise of Green-Shoe option

v. At this IPO pricing Alibaba valued at $168 billion and post Green Shoe option exercised, the company got valued at $231 billion as on September 19, 2014; exceeding the combined market capitalizations of Amazon and eBay, the two leading U.S. e-Commerce companies.

vi. Investment Banks/Underwriters to the IPO: Morgan Stanley, Credit Suisse, Duetsche Bank, J.P. Morgan and Goldman Sachs each of whom got 15.7% share in total $250 million base fee, followed by a 7.9% share to Citigroup. The remianing 13.6% of fees was shared between 28 lower-tier underwriters. Additional $50 million of incentive fees was paid to only the six main banks in proportion to their involvement in the IPO issue. Thus, given that IPO raised $25 billion, the said total fees of $300 million represented 1.2% of the IPO offering size.

vii. Listed on NYSE as BABA on September 19, 2014.

The stock price of Alibaba closed at $93.89 per share, a 38% gain from company's IPO offer price of $68 per share. The opening share price was $92.70 per share

Currently i.e. now as of today, the company's stock is trading @ $64.00 per share on NYSE.

Post IPO, the stock had seen a growth in its market price to $119.15 upto November 10, 2014; Since then till September 2015 till date it has seen a downward trend to reach $64.00 per share. At his market price per share, the current P/E ratio is 40.62 times annual earnings per share. At this market price its total market capitalization stands at $161 billion.

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