Wellcome Trust Toasts £100m Alibaba Profit

By Mark Kleinman, City Editor

Britain's biggest medical research charity is toasting a £100m-plus profit from the flotation of Alibaba Group, the Chinese internet giant that on Friday became the biggest technology company listing ever.

Sky News has learned that at the $68-a-share (£42) pricing settled upon by bankers advising Alibaba, the Wellcome Trust is sitting on a substantial paper windfall from two separate investments it made in the company's shares in recent years.

The news represents a significant boost for medical research funding in the UK and underpins the Wellcome Trust's highly-regarded investment strategy, led by its chief investment officer, Danny Truell.

Jack Ma, Alibaba's founder and now a multibillionaire as a consequence of the company's flotation, was present for the opening bell at the New York Stock exchange on Friday.

The share sale is eventually expected to raise $25bn (£15.3bn), making it the biggest initial public offering in history, once an over-allotment option is exercised.

The Wellcome Trust owns significantly less than 1% of Alibaba stock

It has overtaken Agricultural Bank of China's $22.1bn (£13.5bn) fundraising in 2010 and Facebook, which sold more than $16bn (£9.8bn)  of shares in 2012 to become the biggest-ever technology company listing.

Sky News disclosed the Wellcome Trust's investment in Alibaba in March.

Insiders said the Wellcome Trust, which is one of the world's most renowned medical research organisations, owns significantly less than 1% of Alibaba's shares, although the exact size of its holding is unclear.

A Wellcome Trust spokesman declined to comment.

Alibaba, which is headquartered in Hangzhou, one of China's so-called second-tier cities, has become a major player in the country's e-commerce industry.

It acts as an eBay-style intermediary in the supply and sale of goods online, having established marketplaces targeted at small business traders and consumers.

Using the brand-name Taobao, an e-shopping platform that in China has more than 500 million customers, Jack Ma, Alibaba's founder and chairman, has become one of the world's most successful technology entrepreneurs.

Talks between Alibaba and the Hong Kong Stock Exchange ended without success because of the company's desire to create an alternative shareholding structure that would have given executives additional control over the company.

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