AMENDMENT NO.5 TO FORM F-1 9/1/14, 8:04 PM F-1/A 1 d709111df1a.htm AMENDMENT NO.5 TO FORM F-1 Table of Contents As filed with the Securities and Exchange Commission on August 27, 2014 Registration No. 333-195736 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Amendment No. 5 to Form F-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Alibaba Group Holding Limited (Exact name of Registrant as Specified in its Charter) Cayman Islands 5961 Not Applicable (State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer Incorporation or Organization) Classification Code Number) Identification Number) c/o Alibaba Group Services Limited 26/F Tower One, Times Square 1 Matheson Street Causeway Bay Hong Kong Telephone: +852-2215-5100 (Address and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices) Corporation Service Company 1180 Avenue of the Americas, Suite 210 New York, New York 10036 (800) 927-9801 (Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service) Copies to: Timothy A. Steinert, Esq. Alibaba Group Holding Limited c/o Alibaba Group Services Limited 26/F Tower One, Times Square 1 Matheson Street, Causeway Bay Hong Kong +852-2215-5100 Leiming Chen, Esq. William H. Hinman, Jr., Esq. William Y. Chua, Esq. Jay Clayton, Esq. Daniel Fertig, Esq. Simpson Thacher & Bartlett LLP Sullivan & Cromwell LLP Sarah P. Payne, Esq. Simpson Thacher & Bartlett LLP 2475 Hanover Street 28th Floor Sullivan & Cromwell LLP c/o 35th Floor, ICBC Tower Palo Alto, California 94304 Nine Queen’s Road Central 1870 Embarcadero Road 3 Garden Road Central U.S.A. Hong Kong Palo Alto, California 94303 Hong Kong 650-251-5000 +852-2826-8688 U.S.A. +852-2514-7600 650-461-5700 Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ! If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ! If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ! If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ! http://www.sec.gov/Archives/edgar/data/1577552/000119312514322604/d709111df1a.htm?_ga=1.58487402.137027733.1381162579 Page 1 of 429 AMENDMENT NO.5 TO FORM F-1 9/1/14, 8:04 PM The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to such Section 8(a), may determine. http://www.sec.gov/Archives/edgar/data/1577552/000119312514322604/d709111df1a.htm?_ga=1.58487402.137027733.1381162579 Page 2 of 429 AMENDMENT NO.5 TO FORM F-1 9/1/14, 8:04 PM Table of Contents The information in this preliminary prospectus is not complete and may be changed. Neither we nor the selling shareholders may sell these securities until the registration statement filed with the United States Securities and Exchange Commission is declared effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting any offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion, Dated , 2014 American Depositary Shares Representing Ordinary Shares Alibaba Group Holding Limited This is the initial public offering of Alibaba Group Holding Limited, or Alibaba Group. We are offering American Depositary Shares, or ADSs, and the selling shareholders named in this prospectus are offering ADSs. Each ADS represents ordinary shares, par value US$0.000025 per share. We expect that the initial public offering price of the ADSs will be between US$ and US$ per ADS. We will not receive any proceeds from the ADSs sold by the selling shareholders. Pursuant to our memorandum and articles of association, a partnership, or the Alibaba Partnership, comprised of certain management members of our company, Alipay and China Smart Logistics, will have the exclusive right to nominate a simple majority of the board of directors of our company. See “Alibaba Partnership” and “Description of Share Capital — Ordinary Shares — Nomination, Election and Removal of Directors.” Prior to this offering, there has been no public market for our ADSs or ordinary shares. We will apply for listing of our ADSs on the New York Stock Exchange under the symbol “BABA.” Investing in our ADSs involves risk. See “Risk Factors ” beginning on page 23. Per ADS Total Price to public US$ US$ Underwriting discounts and commissions US$ US$ Proceeds, before expenses, to us US$ US$ Proceeds, before expenses, to the selling shareholders US$ US$ We and certain selling shareholders have granted the underwriters the right to purchase up to an aggregate of additional ADSs. Neither the United States Securities and Exchange Commission nor any state securities commission or any other regulatory body has approved or disapproved of these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The underwriters expect to deliver the ADSs against payment in U.S. dollars to purchasers on or about , 2014. Credit Suisse Deutsche Bank Goldman Sachs J.P. Morgan Morgan Stanley Citi , 2014. http://www.sec.gov/Archives/edgar/data/1577552/000119312514322604/d709111df1a.htm?_ga=1.58487402.137027733.1381162579 Page 3 of 429 AMENDMENT NO.5 TO FORM F-1 9/1/14, 8:04 PM Table of Contents http://www.sec.gov/Archives/edgar/data/1577552/000119312514322604/d709111df1a.htm?_ga=1.58487402.137027733.1381162579 Page 4 of 429 AMENDMENT NO.5 TO FORM F-1 9/1/14, 8:04 PM Table of Contents http://www.sec.gov/Archives/edgar/data/1577552/000119312514322604/d709111df1a.htm?_ga=1.58487402.137027733.1381162579 Page 5 of 429 AMENDMENT NO.5 TO FORM F-1 9/1/14, 8:04 PM Table of Contents http://www.sec.gov/Archives/edgar/data/1577552/000119312514322604/d709111df1a.htm?_ga=1.58487402.137027733.1381162579 Page 6 of 429 AMENDMENT NO.5 TO FORM F-1 9/1/14, 8:04 PM Table of Contents TABLE OF CONTENTS Page Prospectus Summary 1 Risk Factors 23 Special Note Regarding Forward-Looking Statements 66 Operating Metrics 67 Use of Proceeds 68 Dividend Policy 69 Capitalization 70 Dilution 72 Exchange Rate Information 74 Enforcement of Civil Liabilities 75 Our History and Corporate Structure 77 Selected Consolidated Financial and Operating Data 84 Management’s Discussion and Analysis of Financial Condition and Results of Operations 91 Business 149 Regulation 205 Alibaba Partnership 218 Our Directors 223 Our Executive Officers 230 Principal and Selling Shareholders 238 Related Party Transactions 240 Description of Share Capital 255 Description of American Depositary Shares 271 Shares Eligible for Future Sale 280 Taxation 282 Underwriting 289 Expenses Related to this Offering 295 Legal Matters 296 Experts 296 Where You Can Find More Information 297 Index to Financial Statements F-1 This prospectus contains estimates and information concerning our industry, including market position, market size, and growth rates of the markets in which we participate, that are based on industry publications and reports. This prospectus contains statistical data and estimates published by iResearch, the China Internet Network Information Center, or CNNIC, Forrester Research, Euromonitor International, the National Bureau of Statistics of China, State Post Bureau of the PRC, the School of Social Sciences of Tsinghua University and International Data Corporation, or IDC, including a report titled “Global eCommerce Platforms Ranking by Gross Merchandise Volume”, which we requested IDC to prepare and for which we paid a fee and which we refer to in this prospectus as the IDC GMV Report. This information involves a number of assumptions and limitations, and you are cautioned not to give undue weight to these estimates. We have not independently verified the accuracy or completeness of the data contained in these industry publications and reports. The industry in which we operate is subject to a high degree of uncertainty and risk due to variety of factors, including those described in the “Risk Factors” section. These and other factors could cause results to differ materially from those expressed in these publications and reports. You should rely only on the information contained in this prospectus. We have not authorized anyone to provide information different from that contained in this prospectus. We are offering to sell, and seeking offers to buy, ADSs only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of our ADSs. Until , 2014 (25 days after the date of this prospectus), all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealer’s obligation to deliver a prospectus when acting as an underwriter and with respect to unsold allotments or subscriptions. http://www.sec.gov/Archives/edgar/data/1577552/000119312514322604/d709111df1a.htm?_ga=1.58487402.137027733.1381162579 Page 7 of 429 AMENDMENT NO.5 TO FORM F-1 9/1/14, 8:04 PM Table of Contents PROSPECTUS SUMMARY This summary highlights selected information contained in greater detail elsewhere in this prospectus. This summary may not contain all of the information that you should consider before investing in our ADSs. You should carefully read the entire prospectus, including “Risk Factors” and the financial statements, before making an investment decision. Our Mission Our mission is to make it easy to do business anywhere. Our founders started our company to champion small businesses, in the belief that the Internet would level the playing field by enabling small enterprises to leverage innovation and technology to grow and compete more effectively in the domestic and global economies. Our decisions are guided by how they serve our mission over the long-term, not by the pursuit of short-term gains. Our Business We are the largest online and mobile commerce company in the world in terms of gross merchandise volume in 2013, according to the IDC GMV Report. We operate our ecosystem as a platform for third parties, and we do not engage in direct sales, compete with our merchants or hold inventory. We operate Taobao Marketplace, China’s largest online shopping destination, Tmall, China’s largest third-party platform for brands and retailers, in each case in terms of gross merchandise volume, and Juhuasuan, China’s most popular group buying marketplace by its monthly active users, in each case in 2013 according to iResearch. These three marketplaces, which comprise our China retail marketplaces, generated a combined GMV of RMB1,833 billion (US$296 billion) from 279 million active buyers and 8.5 million active sellers in the twelve months ended June 30, 2014. A significant portion of our customers have begun transacting on our mobile platform, and we are focused on capturing this opportunity. In the three months ended June 30, 2014, mobile GMV accounted for 32.8% of our GMV, up from 27.4% in the preceding three months and from 12.0% in the same period in the previous year. The number of mobile MAUs increased from 136 million for the month ended December 31, 2013, to 163 million for the month ended March 31, 2014 and to 188 million for the month ended June 30, 2014. In addition to our three China retail marketplaces, which accounted for 81.6% of our revenues in fiscal year 2014, we operate Alibaba.com, China’s largest global online wholesale marketplace in 2013 by revenue, according to iResearch, 1688.com, our China wholesale marketplace, and AliExpress, our global consumer marketplace, as well as provide cloud computing services. As a platform, we provide the fundamental technology infrastructure and marketing reach to help businesses leverage the power of the Internet to establish an online presence and conduct commerce with consumers and businesses. We have been a leader in developing online marketplace standards in China. Given the scale we have been able to achieve, an ecosystem has developed around our platform that consists of buyers, sellers, third-party service providers, strategic alliance partners, and investee companies. Our platform and the role we play in connecting buyers and sellers and making it possible for them to do business anytime and anywhere is at the nexus of this ecosystem. Much of our effort, our time and our energy is spent on initiatives that are for the greater good of the ecosystem and the various participants in it. We feel a strong responsibility for the continued development of the ecosystem and we take ownership for this development. Accordingly, we refer to this as “our ecosystem.” Our ecosystem has strong self-reinforcing network effects that benefit our marketplace participants, who are invested in our ecosystem’s growth and success. Through this ecosystem, we have transformed how commerce is conducted in China and built a reputation as a trusted partner for the participants in our ecosystem. We have made significant investments in proprietary technologies and infrastructure in order to support our growing ecosystem. Our technology and infrastructure allow us to harness the substantial volume of data generated from our marketplaces and to further develop and optimize the products and services offered on our platform. 1 http://www.sec.gov/Archives/edgar/data/1577552/000119312514322604/d709111df1a.htm?_ga=1.58487402.137027733.1381162579 Page 8 of 429 AMENDMENT NO.5 TO FORM F-1 9/1/14, 8:04 PM Table of Contents Through contractual arrangements with Alipay, we offer payment and escrow services for buyers and sellers, providing security, trust and convenience to our users. Since 2011, we have not held any interest in or control over Alipay or its parent company. Following the divestment of our interest in and control over Alipay, effective in the first calendar quarter of 2011, we have maintained long-term commercial arrangements with Alipay, which we believe align both companies’ interests in the success of our ecosystem. We also continue to derive economic benefits from our contractual arrangements with Alipay. For further details regarding our relationship with Alipay and its parent company, including the recent restructuring of our contractual arrangements with them in August 2014, see “Related Party Transactions — Agreements and Transactions Related to Small and Micro Financial Services Company and its Subsidiaries — Ownership of Small and Micro Financial Services Company.” We take a platform approach to shipping and delivery by working with third-party logistics service providers through a central logistics information system operated by Zhejiang Cainiao Supply Chain Management Co., Ltd., or China Smart Logistics, our 48%-owned affiliate. Through our acquisition of UCWeb, we are able to leverage its expertise as a developer and operator of mobile web browsers to enhance our mobile offerings beyond e-commerce, such as general mobile search, which gives us access to UCWeb’s large base of mobile users and offers our existing user base additional mobile solutions. Our revenue is primarily generated from merchants through online marketing services (via Alimama, our proprietary online marketing platform), commissions on transactions and fees for online services. We also generate revenues through fees from memberships, value-added services and cloud computing services. GMV generated on our China retail marketplaces increased by 55.8% from RMB1,077 billion in fiscal year 2013 to RMB1,678 billion (US$270 billion) in fiscal year 2014. Our total revenue increased by 52.1% from RMB34,517 million in fiscal year 2013 to RMB52,504 million (US$8,463 million) in fiscal year 2014. Our total revenue increased by 46.3% from RMB10,778 million in the three months ended June 30, 2013 to RMB15,771 million (US$2,542 million) in the same period in 2014. We do not allocate revenue among each of our China retail marketplaces. Our net income increased by 170.6% from RMB8,649 million in fiscal year 2013 to RMB23,403 million (US$3,772 million) in fiscal year 2014. Our net income increased by 179.6% from RMB4,448 million in the three months ended June 30, 2013 to RMB12,438 million (US$2,005 million) in the same period in 2014. For the three months ended June 30, 2014, our net income included a net gain of RMB6,251 million (US$1,008 million) from step-up acquisitions arising from revaluations of previously held equity interest. Our fiscal year ends on March 31. Our Key Metrics We have experienced significant growth across various key metrics for our China retail marketplaces: 2 http://www.sec.gov/Archives/edgar/data/1577552/000119312514322604/d709111df1a.htm?_ga=1.58487402.137027733.1381162579 Page 9 of 429 AMENDMENT NO.5 TO FORM F-1 9/1/14, 8:04 PM Table of Contents 3 http://www.sec.gov/Archives/edgar/data/1577552/000119312514322604/d709111df1a.htm?_ga=1.58487402.137027733.1381162579 Page 10 of 429