Chinese e-commerce company Alibaba.com will not seek a public listing this year, and is planning to launch an aggressive attack on the US online auction giant eBay's business in China, said the company's top executive.

"We have never thought about making an initial public offering (IPO) in 2005," said Jack Ma, chairman and CEO of the biggest business-to-business (B2B) e-commerce company in China, in an interview in Beijing.

The Hangzhou-based company, invested by global venture capital giants Softbank, Fidelity, and Granite Global Ventures, was believed to be a hot IPO candidate for this year.

Domestic professional venture capital market research house Zero2ipo said last month that possible large-scale IPOs of companies such as Alibaba will push the venture capital industry in China to a new height after hitting US$1.27 billion last year.

The demands of venture capital investors were believed by industrial observers to be a major driving force behind the push for the company's listing.

However, Ma said Alibaba has an adequate money supply, so there was no need to rush for an IPO for the purpose of raising capital.

Alibaba reached its 2004 goal of achieving an average daily operating profit of 1 million yuan (US$120,000).

Ma said the company's employees, after working very hard in past years to survive Internet fluctuations since 2000 and achieve profitability, also needed to have time to enjoy their work, rather than putting themselves under huge pressure as a public company.

Another benefit of not making an IPO is that the company will have no obligation to disclose its financial and operating data, so that competitors such as eBay can not know Alibaba's business strategies and moves from public resources.

Alibaba's customer-to-customer (C2C) website Taobao.com competes fiercely with eBay Eachnet.

It spent 100 million yuan (US$12 million) on building a payment system, technological support, advertising, and, most importantly, providing free trading services for Taobao.

Ma said last year his company would invest another 340 million yuan (US$41 million) in Taobao and is prepared to provide free services on Taobao for five years.

EBay, which had a overwhelmingly dominant position in the Chinese market through Eachnet when Taobao started in 2003, was reported saying that it will destroy Taobao in 18 months.

However, the US giant did not pay due attention and lost ground in competition with Taobao.

Alibaba's Ma said Taobao already had over 4 million registered users and beat eBay-Eachnet in the number of listed products' trading volume.

"It is our turn to attack in the next 18 months," said Ma.

He declined to say how Taobao will attack eBay in China, but suggested the improvement of the payment system is key.

Taobao has a payment tool called Strade, in which buyers send the payment to an account designated by Taobao and sellers can only get the money from the account, when buyers receive their goods and verify the deal, so as to curb cheats on the Internet.

The business, partnered with the Industrial and Commercial Bank of China (ICBC) and China Construction Bank in Strade, claims to be the biggest single client of ICBC in terms of the number of users.

Ma said the focus of Alibaba's B2B business in 2005 would be on overseas expansion.

The business started an advertising campaign of more than US$12 million in major Western media, including CNBC, in September.

Ma said the goal was to develop buyers in the United States, the European Union, and Japan.

Alibaba also set up an overseas development department with almost 100 employees.

(China Daily January 4, 2005)