Alibaba swings a large one with STONKING IPO legal bills

Alibaba's initial public offering legal bill has swelled to $15.8m. As noted by Reuters, that's six times the amount paid by Facebook ($2.6m) when it prepared to float onto Wall Street in May 2012. The Chinese e-commerce giant disclosed its big $15.8m payout to lawyers in a filing with the US Securities and Exchange …

[Mark 85]

I'm not sure if I can trust their numbers...

From their website (about us): For a company that was founded in 1999, lasting at least 102 years means we will have spanned three centuries, an achievement that few companies can claim.

So exactly how does a company founded in 1999 have lasted for 102 years and spanning 3 centuries? Did I sleep through math class?

[Michael B.]

Re: I'm not sure if I can trust their numbers...

The way I read it: As the company was founded in 1999 if it lasts at least 102 years then the company will have been active in the 20th, 21st and 22nd centuries. Which in itself is a bizarre statement to make.

[Tom 35]

Did I sleep through math class?

No BS marketing 101

[razorfishsl]

Re: Did I sleep through math class?

Google translate…..

Or maybe they are like BFL in the US, who claim they have 20 years EXP. even though they have been in business for 2 years.

Just take the EXP. of each of your staff and add it up….

[John Tserkezis]

Re: I'm not sure if I can trust their numbers...

"Did I sleep through math class?"

Voodoo mathamatics. I had first seen it when a past employer asked me to look over an earlier prospective employee who was asked some basic opamp with divider maths during the interview stage (everyone was asked the same questions).

He had the right answer and showed working, but the boss had no idea what technique this guy used to get there. I couldn't work it out either, so suggested voodoo mathamatics.

You get there in the end, but no-one knows what black magic they used inbetween. You know, like gigahertz range radio theory, except applied for school grade maths.

[JustWondering]

Just a start

How long before they go international?

[John Bailey]

Re: Just a start

Aren't they already?

[frank ly]

big $15.8m payout to lawyers

I assume they had fourty lawyers working on the IPO.

[Anonymous Coward]

Re: big $15.8m payout to lawyers

I'm surprised that the legal bill is so small. IPOs and M&A are lodes of 100% pure moolah for law firms, and for a Chinese company with no history in the US to launch a $20bn listing on the basis of legal advice costing less than $16m it looks like very good value indeed. The investment bank leeches have reputedly shared 1% of the IPO value as fees, so that's $200m in fees which makes the legal fees look like small beer.

At average values for big US law firms the $16m equates to perhaps 22,000 hours of billable time, or 16 lawyer-years. Over a four month period your 40 figure is about right, but that then implies no big fat success fee, and none of the traditional padding of the figures.

[Destroy All Monsters]

Re: big $15.8m payout to lawyers

How the F*CK does one need 22'000 hours of work for a shitty IPO? It's an IPO. It's supposed to raise money (in this case a ludicrous amount that can only ever be possible in proto-Weimar idiot show of rampant money generation, but still...) That's all.

They must be handselecting the cocaine grains that Wall Street mavens will blow up their behinds in the evening.

[Anonymous Coward]

I'm constantly looking up parts on google and if the first obvious ones don't pop up, alibaba comes up.not saying they have it, just I've seen their name many times and over the past few years I get more and more search results with them. With that said there is a damn good article over on google news about alibaba and Mr. Ma, I would highly recommend everyone take a glance at. The guy has drive, and he knows what he wants and how to get it. But, and you really need to read the article, I would be very hesitant to purchase stock in this company. This is worse than owning stock in Facebook and has the potential to backfire on investors. This guy wants to be a millionaire, and like many who do and who are, he will fuck anyone outside his circle in order to get there. Buying stock in anything is a gamble, but he screwed over yahoo and a few others and has the potential to so in the US even more so.

[Gis Bun]

Errrr

Wouldn't trust a site that resorts to pop-up windows for them to advertise [after you click on an "agree" or other button].

[razorfishsl]

Many of these Companies are corporate scum bags, if you get into the root of what is going on (via the Chinese press)

you will see that these companies want to sell the 'shares' but prevent shareholders from voting on the management of the organizations.

Basically the shares are a free capital loan to the owners, you will also see that since the company is based in China it is subject to Chinese tax laws.

There was a recent case with a well known Chinese bank listed on the HK market, they actually used the shareholders dividends to offset & pay down their Chinese tax bill!!!!!

http://webb-site.com/articles/minsheng.asp

So as always it is a case of buyer beware.