Alibaba clarifies internal partnership structure to public

China's e-commerce giant Alibaba Group Holding Ltd Tuesday formally announced its partnership structure and said the company will list on a stock market where such a structure can be accepted.

The company has been running a partnership structure in its management team since 2010, in an attempt to preserve the e-commerce company's culture and ensure its long-term business development, according to Alibaba's press release e-mailed to the Global Times Tuesday.

Every year, employees who have served Alibaba for at least five years and showed good leadership will have an opportunity to join the management team as a partner. Currently there are 28 partners including Chairman Ma Yun, CEO Lu Zhaoxi and other senior managers, said the company.

According to recent media reports, the partnership structure is exclusively designed for Alibaba's potential IPO, which is expected to ensure that Ma and the management team will be able to retain control over decision-making after the company goes public.

But Ma clarified this allegation Tuesday in an e-mail sent to his employees to mark Alibaba's 14th anniversary, saying that the partnership was not used to "exert greater control over the company" but to protect the company from the temptation to pursue short-term profitability.

Partners are the operators of the company as well as shareholders, therefore they could adhere to this goal, according to Ma.

He also said that the company is not concerned about where to go public, and will choose an exchange that will accept its partnership structure.

"There is no timetable for our IPO. Also, we have neither decided which investment bank will underwrite the IPO nor where to go. Hong Kong and the US can both be options," a PR representative from Alibaba, who asked to remain anonymous, told the Global Times Tuesday.

Hong Kong is the company's likeliest IPO venue, but its stock exchange does not allow dual class listing, which might result in Hong Kong losing the largest IPO this year, Li Ling, an analyst with ChinaVenture Investment Consulting, told the Global Times Tuesday.

Dual class listing, which can offer a company's founder and management more voting power than its individual investors, is allowed in US exchanges like New York Stock Exchange and NASDAQ.

Alibaba is expected to launch an IPO worth over $15 billion, which would make it one of the global Internet industry's largest IPOs and a huge attraction for stock exchanges around the world.