China's leading B2B platform delisted

Alibaba.com, a leading business-to-business website of the Chinese Internet giant Alibaba Group, delisted from the Hong Kong Stock Exchange on Wednesday.

The withdrawal of the listing, signaling the privatization of the group's only publicly traded subsidiary, took effect at 4 p.m., according to a statement jointly issued by the group and the website Wednesday morning.

The privatization of Alibaba.com was sanctioned by the Grand Court of the Cayman Islands, where the group is registered, on Friday local time, as the vast majority of the website's minority shareholders voted in favor of the scheme in late May, said an earlier statement.

Alibaba offered to buy back a 26-percent stake in its subsidiary for 13.5 Hong Kong dollars (1.74 U.S. dollars) a share, at an estimated cost of 19 billion Hong Kong dollars.

Shareholders gave their nod days after Alibaba Group announced it would spend about 7 billion U.S. dollars in repurchasing up to half of its major shareholder Yahoo! Inc.'s stake in the company, or approximately 20 percent of Alibaba's fully diluted shares.

According to the agreement reached between the two sides, if Alibaba makes an initial public offering (IPO) by the end of 2015, it will buy back half of Yahoo's remaining stake -- a 10-percent holding -- at the time of the IPO.

Alibaba.com was established in 1999 by Jack Ma in Hangzhou, capital city of Zhejiang province, and went public in 2007.

Taking the website private would allow the company to make long-term decisions that are in line with customers' best interests, and it would free the company from the pressures that stem from having a publicly listed company, Ma, the group's chairman, said after announcing the plan in February.

Starting last year, the B2B platform, specializing in matching buyers and sellers around the globe with Chinese suppliers, has shifted its strategy from expanding the number of paying members to fostering a site with better quality and service for buyers by lifting the entry threshold. The change has led to a drop in the number of vendors.

The privatization of the Hong Kong-listed flagship company has been widely seen as a preparation for the expected IPO of Alibaba Group.

"There is no timetable for the group's IPO. As for the year 2015 mentioned in our agreement with Yahoo, it may be a time that both sides feel reasonable," Zheng Ming, chief strategy officer of the group, said at a press conference Wednesday afternoon.

Hu Yanping, founder of the Data Center of the China Internet, said the withdrawal of the listing can allow Alibaba to better adjust its business, shareholder relations and share structure in order to make clear the strategy for future development and facilitate the group's IPO.

Besides Alibaba.com, the group also includes Taobao, a leading C2C online shopping destination, and Tmall.com, a popular B2C online marketplace for brand-name goods, as well as eTao, a shopping search engine.

China's Internet companies have been increasingly active in the capital market. Another Internet company, Shanda Interactive Entertainment Ltd., delisted last year due to business difficulties.

Li Yongzhuang, a professor with the Central University of Finance and Economics, said the delisting of Shanda and Alibaba shows that China's businesses are becoming more mature in capital operation.

The listing of a company is just a way of financing, Li said, adding that apart from raising capital, enhancing a company's reputation and increasing credibility in the market, the listing can also bring about a sharp increase in the both the direct and invisible costs for the company.

The listed company has the responsibility to expose some information which, to a certain degree, can reduce the secrecy of the company's operations, and the delisting of Alibaba.com could be part of the group's strategy for listing on a larger scale, Li said.