Question

Corporate Governance

If you were a senior executive at Alibaba, would you have made the same decision? What would you recommend for taking the company's stock public? Why?

Answer 1

As a senior executive of the Alibaba group I would have made the same decision of taking the company's stock public because our organization is a growing organization, the market share is increasing day by day and our competition is also increasing. In order to be in a competitive position and to increase our market share we need more funds. Debt is also an option but it has to be used to a limited amount. That is why the other option (making the stock public) will be more suitable as we are a known face therefore people will buy our stock easily and we will be able to raise funds for further growth and development.

Note- It doesn't means that we have to use a no debt policy but it means that we should use an optimum combination.