New York: Alibaba Group Holding Ltd disclosed that it would pay $15.8m in legal fees to law firm Simpson Thacher and other attorneys who advised the Chinese e-commerce giant on its upcoming IPO, six times what Facebook paid its counsel two years ago.
Alibaba, which is seeking to raise as much as $21bn in an IPO expected later this month, made the disclosure in a prospectus on Friday filed with the US Securities and Exchange Commission.
The Chinese company, whose sales are larger than Amazon.com and eBay combined, has a complex structure and has frequently revised its prospectus. That has all increased legal fees, analysts said.
The legal fees for Alibaba’s IPO rank the fourth highest in the past 10 years, according to IPO Vital Signs.
The 2013 IPO of Empire State Realty trust ranked the highest, with a whopping $32.8m in estimated legal fees, while the IPO of Kinder Morgan in 2011 cost the pipeline company $17m. The 2005 IPO of investment bank Lazard cost $16m.
Facebook Inc’s May 2012 IPO garnered $2.6m in legal fees.
In addition to Simpson, Alibaba’s New York-based law firm, its Chinese counsel, Fangda Partners, and Cayman Islands adviser Maples and Calder, will share the attorneys’ fees, according to the filing. It was not immediately clear how the firms would split the $15.8m in fees, but Simpson likely will get the lion’s share of the money.
Alibaba expects to price its initial public offering between $60 and $66 per American Depository Share, valuing the company at about $162.69bn at the top end of the range and raising as much as $21.1bn.
Reuters
