Zhitong Financial App News, Alibaba-SW (09988) issued an announcement. The company has submitted Form 6-K to the US Securities and Exchange Commission (SEC) regarding the company's intention to issue convertible senior notes (notes) with a total principal amount of US$4.5 billion due in 2031. Note issuance is limited by market and other conditions, and is subject to the provisions of the 1933 US Securities Act and its revised (Securities Act) section 144A, to certain non-Americans under the S Regulations under the Securities Act Conduct offshore transactions. The company expects to grant the initial purchaser of the notes the option to purchase additional notes with a total principal amount of up to US$500 million, and can exercise the relevant options within 13 days from the date the notes are issued (including the day).

The Company intends to use the net amount of capital raised from the issuance of the notes, as described below, through private agreement transactions with one or more initial purchasers or their related parties (as agents of the company) to repurchase several companies' American Depositary Shares (each American Depositary Share currently represents eight common shares) (simultaneous repurchases) in accordance with the Company's existing share repurchase plan at the same time as issuing and pricing the notes to fund further share repurchases carried out from time to time in accordance with the Company's existing share repurchase plan; and to fund the costs required for bullish transactions with limited prices as set forth below.

The company expects to enter into a price limit bullish deal with one or more of the initial purchasers and/or their related parties and/or other financial institutions (opters) for the pricing of the notes. Generally speaking, a bullish limit transaction is expected to reduce the potential dilution of American Depositary Shares and the common stock of the company it represents when the notes are converted, and/or offset any subsequent cash payments due by the company in excess of the principal amount of the converted notes, but such reduction and/or offset is subject to relevant limits (which are expected to be 100% higher than the final transaction price of American Depositary Shares on the day the notes are issued and priced), and limited by the company's ability to choose to settle the limit bullish transaction in cash or in part (in such cases, when the bullish price limit is met) When the transaction is settled, The portion of the company that chooses to settle in cash will not receive American Depositary Shares from the electing party). If the initial purchaser exercises its option to purchase additional notes, the company expects to use a portion of the net capital raised from the sale of such additional notes to enter into an additional limited-price bullish transaction with the opting party, and use the balance to fund further share repurchases in accordance with the existing share repurchase plan.

To establish an initial hedge against their limited-price bullish transactions, the electors or their respective related parties are expected to buy American Depositary Shares and/or common shares and/or enter into various derivative transactions relating to American Depositary Shares and/or Common Shares at the same time or shortly after the price of the notes. Such actions may raise the market price or note price (or reduce the extent to which such prices fall) of American Depositary Shares and/or common stock, or other securities of the Company at that time. The impact of such action (including its direction or magnitude) on the market price or note price of American Depositary Shares and/or Common Shares (if any) will depend on various factors, including market conditions, and is currently uncertain.

Since the company expects to repurchase the estimated initial hedging value of the entire transaction, after considering purchases related to the bullish initial hedging limit transaction made by the opting party, the relevant simultaneous repurchase expectations can facilitate initial hedging for investors interested in hedging the notes. The company expects to use the final transaction price of each American Depositary Share on May 23, 2024 as the purchase price for the simultaneous repurchase. In addition to simultaneous repurchases, the company may also make additional purchases of American Depositary Shares and/or Common Shares on the open market from time to time after the notes are priced. Simultaneous repurchases and future repurchases under the company's share repurchase plan will be paid with funds raised from the issuance of notes or other cash, and are generally expected to offset the potential dilution of American Depositary Shares and the common shares of the company they represent when the notes are converted. The company's repurchase actions, whether carried out simultaneously with note pricing or in accordance with the company's existing share repurchase plan, may cause the market price and/or note price of American Depositary Shares and/or Common Shares to rise or decrease.