Alibaba delisting what happens?

I have just used the chat feature on T212. I was told that T212 are working/testing a feature to allow OTC shares to be transferred from ISA to Invest. I was not given an ETA on this. This will solve the issue of baba shares being automatically sold if baba gets delisted and goes OTC. As they will be in invest, and invest allows for OTC. However, I would also would support the notion of the shares being transferred to the HK exchange.

T212 need to solve this issue before baba gets delisted as this will affect a large proportion of T212ā€™s user baseā€¦

How does OTC actually work can someone explain? I read the help sections explanation and was none the wiser. Is it that T212 would trade the now non existent shares with a broker who has HK access?

I am guessing the price would track HK?

I mean couldnā€™t you just sell out, withdraw from ISA and then re-buy in invest before it goes OTC? Whatā€™s the benefit of them transferring other than the FX fees? Or would that not count against your ISA or something

Just not sure why would need OTC, it would be simpler to just have access to SEHK equities directly surely? Or am I missing something. OTC is often for less liquid and smaller companies, not a massive company like Alibaba.

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Sure but T212 wonā€™t commit to a timescale for HK or even whether they are still working on it so I wouldnā€™t hold your breath

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I would definitely prefer the shares to be transferred to the HK exchange, I am just thinking of all options.

I am sure T212 will prepare a solution. This baba weā€™re talking about, not some shite penny stock. This would affect a large proportion of the T212 user base

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Same 1000% but letā€™s get real T212 canā€™t even take on new customers and you think they will pull HK out of the hat?

(No hate I like T212 just calling it as I see it)

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They can delist it without going OTC.
But BABA ADR is on IKBR list to transfer it to HK exchange if delisting happens.
https://ibkr.info/node/1834
https://www.interactivebrokers.com/en/index.php?f=15260#supported-adr

You just need to find out what T212 does in that case, but Iā€™m pretty sure you wonā€™t lose shares. Worst case scenario is that you need to convert to cash.

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Each BABA share is good for 8 9988.HK shares. No reason why T212 canā€™t facilitate the transfer from NYSE to HK exchange.

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Yesterday on Twitter they said they have no ETA for HK. You donā€™t build out a digital product in a week it could be years (if ever) that they have that ability

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True, I see your point

Other option is opening next yearā€™s ISA with another broker, and using next yearā€™s allowance to flip things over.

Assuming you have the extra cash available next year that is.

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the two are unconnected. I have written to support to find out.

Here is a fun fact. Didi is not available on the ISA to invest so anyone holding Didi stock was only on the Invest accounts.

I have also written to AJ Bell to find out what they will do.

My thinking is in the worst case, I can sell the BABA stock at a loss and transfer the funds to an ISA provider that supports a HK listing, 9988 is available on AJ Bell but I donā€™t know if you can trade there. So whilst I realise the loss, I minimise this by in essence buying the same stock at the same price (minus dealing charges and fx)

I also think the market is panicking way too muchā€¦

Facts:

  • Didi was specifically told not to list on NYSE
  • Ever since listing Didi has had issues with the regulators and CCP
  • BABA has been listed on NYSE for over 5 years without any issues
  • BABA is the third largest Chinese company in the world

I honestly think there is a bit of balancing people need to do, yes the delisting is a possibility but lets just put things into context here for a secondā€¦

Another data pointā€¦

@TheNimbleNomad good info/insight youā€™ve shared on BABA and i have actually seen some of your videos too for other topics.

However the trouble is fund managers are selling off BABA which makes me think thereā€™s something theyā€™ve seen/known that we retail investors are not privy to - so just maybe the market is not panicking too much

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This could be a good middle ground solution. My Baba position is wayy too big to easily fill in another ISA quickly but it would reduce the risk

You would lose your ISA allowance? Or do you mean transfer your ISA because that would take you out of the market for a month

Agreed- panic is premature however all the rumours coming out of Beijing is that the Chinese are not going to move heaven and earth to keep US listings*.

I am no expert in US politics but Congress agreed in a rare bipartisan ruling under Trump that the SEC has to enforce full audit requirements. The days of flouting the rules are over one way or the other.

  • Rui Ma a former Chinese equity analyst and Bloombergā€™s retracted article point to US ADR shake up as borderline inevitable. A full delisting? Maybe, maybe not.
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