Alibaba has restructured its relationship with the parent of Alipay, eliminating a $6bn cap on the Chinese ecommerce group’s potential gain if the payment processor or its parent go public.
The overhaul comes as Alibaba prepares for its own listing in New York, which could be the largest initial public offering ever. The restructuring also includes divesting Alibaba’s small and medium business loan business to Alipay’s parent, shifting the risk of credit defaults from its balance sheet.
Alibaba, which values itself at $133bn, is expected to raise about $20bn in an IPO this autumn in New York. While many investors are optimistic about the potential growth of China’s ecommerce market, which Alibaba dominates, the company has been working to assuage concerns about its unusual governance and the complexity of some of its lines of business.