Alibaba Plans Hong Kong Spin-Off of Chip Unit T-Head
Alibaba is moving to put its in-house chip designer on the market. Late Tuesday the company said the Hong Kong Stock Exchange will allow it to spin off T-Head, its semiconductor subsidiary.
Two approvals stand between T-Head and a listing
Alibaba plans to offer T-Head shares to the public in Hong Kong. Two approvals are still needed, one from the exchange and one from the China Securities Regulatory Commission. The filing gives no date for a listing and no proposed size.
Alibaba had already filed confidentially on Sept. 11 to list T-Head in Hong Kong.
The chips behind the unit
In late September Alibaba presented its next-generation AI chip, the Zhenwu V900. It said the chip delivers three times the performance of the Zhenwu M890, which came out in May.
Alibaba is one of several Chinese companies, Huawei among them, building homegrown semiconductors for AI work. It does so amid growing US restrictions on China's ability to access such chips.
A shadow from the Nvidia story
In May the short seller Culper Research alleged that Alibaba obtained restricted Nvidia chips by indirectly financing entities in Southeast Asia. Alibaba did not immediately respond to a request for comment. One of those entities is linked to the alleged Chinese spy in the news about Nvidia CEO Jensen Huang's affair. That story has been tied to a slide of Alibaba's stock to its lowest valuation since late March, and it has weighed on the overall US market.
Hong Kong-listed Alibaba shares traded 1% lower on Wednesday morning. They are down about 29% so far this year.
A cooler market for chip listings
Chinese financial regulators have stepped up their scrutiny of tech IPOs in recent months, along with the rush of capital into the sector. Baidu is reported to have put off floating its chip unit Kunlunxin, and the memory chip maker YMTC has done the same, according to news reports this month. Neither company immediately responded to requests for comment.
Chinese tech stocks trail US ones, though DeepSeek's AI breakthroughs excited investors last year.
Elsewhere, US-based Anthropic said in an updated filing on Tuesday that it will offer 825 million shares in its upcoming IPO at $70 to $78 per share. People familiar with the plans say trading on the Nasdaq is expected to begin on Nov. 19.
Source: CNBC