(Reuters) - Chinese e-commerce company Alibaba Group Holding Ltd IPO-BABA.N will allow employees and people close to the company to buy shares in its forthcoming initial public offering, the Wall Street Journal reported, citing people familiar with the matter.
The program, informally known as a “friends and family” plan, allows employees and people buy shares at the IPO price before it starts trading publicly. Normally, the IPO price is available only to professional investors and a few individual investors.
Such programs were a popular practice by U.S. companies during the 1999-2000 dot.com boom as a way to reward employees but has declined since then, the newspaper said. (on.wsj.com/1u6O1jz)
Alibaba is nearing the launch of its hotly anticipated offering, which could raise more than $20 billion, making it the biggest technology listing in the United States.
Reporting by Tanya Agrawal in Bangalore; Editing by Maju Samuel