Chinese Internet giant Alibaba Group Holding Ltd. will reportedly postpone an initial public offering on the Hong Kong stock exchange because of ongoing political tensions in the territory.

Alibaba’s listing was scheduled to take place in late August and could have raised up to $20 billion for the company.

But Reuters said the company decided to postpone the listing during a board meeting before it reported its first-quarter earnings last week. The decision was taken due to a “lack of financial and political stability in Hong Kong,” following more than 11 weeks of demonstrations that have plunged the Asian financial hub into chaos.

Alibaba is now looking at October as a possible new date for the Hong Kong listing, assuming the political tensions have eased and market conditions become favorable again, Reuters said, citing two anonymous sources familiar with the matter.

Alibaba’s decision may well have come following pressure from the Chinese government.

“It would be very unwise to launch the deal now or anytime soon,” the first source said. “It would certainly annoy Beijing by offering Hong Kong such a big gift given what’s going on in the city.”

Alibaba was reportedly planning to use the capital raised from the listing to fund its investments in “frontier technologies,” Reuters said. Still, the postponement is not a major blow to the company’s plans, the second source said. The listing is simply a way for Alibaba to “diversify its access to capital markets,” the source added.

The irony for Alibaba, said Constellation Research Inc. analyst Holger Mueller, is that listing in more than one locale is “exactly what Alibaba tries to protect themselves from: economic and political swings and trends. But you can only do this when you have the double listing.” So it’s still important for the company eventually

Alibaba had previously listed on Hong Kong’s stock market in 2007, only to delist in 2012. The internet retailer announced one year later it was considering going public again, and Hong Kong was thought to be its preferred destination. But Alibaba snubbed the former British colony in favor of a $25 billion listing on the New York Stock Exchange because Hong Kong refused to accept dual-class share structures.

Last year, however, Hong Kong’s stock exchange changed its rules to allow dual-class technology listings, paving the way for Alibaba’s return.

Photo: Alibaba