Alibaba prices $3.2 bn convertible notes to boost cloud and international commerce

Alibaba Group has priced its offering of approximately $3.2 billion in zero coupon convertible senior notes due 2032. The unlisted notes, with a principal amount of $1,000 per note, will be sold to certain non-U.S. persons in offshore transactions. The initial conversion price is $193.15 per ADS, representing a 31.25% premium to the reference share price.

The company anticipates net proceeds of approximately $3.13 billion from the offering, primarily allocated to general corporate purposes. Specifically, 80% will enhance cloud infrastructure, while the remaining 20% will expand international commerce operations. The offering is expected to close on September 16, 2025.

Alibaba also entered into capped call transactions to mitigate potential dilution, effectively raising the conversion price to $235.46 per ADS, a 60% premium to the reference share price. The capped call premium amounted to approximately $183.74 million, representing 5.8% of the aggregate principal amount of the notes.