Alibaba stressed Hong Kong remains its ideal listing destination although it has been approached frequently by US exchanges seeking the e-commerce giant's mega offering.
Company management told visiting Hong Kong journalists at Alibaba's Hangzhou headquarters that negotiations on a proposed initial public offering with SAR authorities reached a deadlock.
But they emphasized the firm has no urgent need for financing.
"It takes time for Hong Kong to digest innovative management concepts," said chief executive Jonathan Lu Zhaoxi, referring to the company's proposed partnership listing structure.
"But Hong Kong has always been our favorite," Lu stressed.
He said chairman Jack Ma Yun felt upset that months of talks had come to nothing and that Ma had a strong desire to come back to Hong Kong after the group's B2B unit was delisted from the main board in 2012.
Lu, speaking in Cantonese, said "the fault is ours as we failed to actively communicate with the SAR. We underestimated the complexity of listing regulations in Hong Kong." He vowed to boost communication in the future.
Alibaba expressed gratitude to New York's Nasdaq exchange which, through CEO Bob Greifeld, said it would be honored to have the tech giant list there.
Lu also said meeting with British officials in Hong Kong during the recent visit by London mayor Boris Johnson was a mere formality.
Chief risk officer Shao Xiaofeng said Hong Kong authorities were concerned about Alibaba's control over minority shareholders. The firm only intended to preserve its DNA by having founders be board members of the listed entity.
Asked whether the firm has relented on having one of its founders being appointed CEO, Shao said: "Now it's time for both of us to cool down on the IPO issue for a while." Alibaba raised US$17 billion (HK$132.6 billion) through the private market last year.
By coincidence, Hong Kong Exchanges and Clearing chief executive Charles Li Xiaojia took to his blog yesterday, writing about shareholding structures, implicitly addressing the Alibaba listing issue. He did something similar last month.
Li raised eight questions and gave his own answers. He said it is unacceptable to lose a mega IPO without debating the balance between investor protection and embracing deals from innovative companies. He said the founders' vision is usually in line with shareholder interests.
"These founders are so vital to their companies, protecting them is also a form of investor protection. In fact, most international markets are willing to allow shares with differentiated voting rights."