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Temasek's ADRs in Alibaba up fivefold in Q1

[SINGAPORE] The number of Temasek Holdings's reported American depositary receipts in Alibaba Group Holding increased almost fivefold in the first quarter, indicating other securities were switched into US-traded shares.

The Singapore state-owned investment firm owned 53.2 million American depositary receipts, or ADRs, in Alibaba valued at US$4.4 billion, as of March 31, according to a filing with the US Securities and Exchange Commission on Friday. That's up from 10.7 million receipts at the end of December.

"Given that they sold ADRs in the previous quarter, it would be strange if they bought new shares now," said Victoria Barbary, director at the London-based Institutional Investor's Sovereign Wealth Center. "It seems they converted another form of security to American depositary receipts." Temasek was an early investor in Alibaba in 2011, about three years before China's biggest e-commerce company raised US$25 billion in an initial public offering in September in the US. It hasn't disclosed the amount of its holdings in Alibaba's China-registered shares. The ADRs it got through the IPO are converted from holdings in that stock.

"I can confirm the 13F filing we've made with the US SEC as part of our normal obligations that reflect our positions in US securities, including ADRs," Stephen Forshaw, a spokesman for Temasek, said in an e-mailed statement. He declined to comment further.

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Bob Christie, an Alibaba spokesman, declined to comment.

Founded by billionaire Jack Ma, Alibaba sold shares for US$68 apiece in its IPO on Sept 18 and the price reached a record US$120 in November. They have declined about 26 per cent since then.

Temasek had invested S$50 million (US$38 million) in Alibaba in its fiscal year ended March 2011, it said in that year's annual report. It was one of the investors that agreed to buy as much as US$1.6 billion stock from Alibaba employees, people familiar with the matter said in Sept 2011.

The investment firm was among buyers when Alibaba repurchased shares from Yahoo! Inc in 2012 through transactions valued at US$7.6 billion and sold them partly to existing shareholders. Two lock-up periods for a combined 15 per cent of the company's US publicly traded stock have ended already. A third one will end in September.

Temasek also holds Alibaba shares through a unit called Seatown Holdings Pte, which sold about 1 million ADRs in the first quarter, according to separate filing with the SEC on May 4, leaving it with 6.4 million shares.

The company also bought about 2 million shares in offshore services provider Oceaneering International Inc, valued at US$107 million as of March 31, according to Friday's filing. It sold 6 million shares in chip-maker Qualcomm Inc. and divested of 7.8 million ADRs in potash producer Mosaic Co.