Photographer: Qilai Shen / Bloomberg
Photographer: Qilai Shen / Bloomberg
Alibaba Group Holding Ltd. raised a proposed $ 4 billion to $ 10 billion share buyback program, providing more support for stocks battered by a growing antitrust investigation into the country’s most powerful Internet companies.
Its shares fell more than 5% in early Hong Kong trading to a six-month low. China’s leader in e-commerce said Monday it has begun to buy back shares this quarter and the board has approved an increase in that program, effective for two years through the end of 2022.
Once hailed as the flag bearers of China’s economic and technological rise, Alibaba and rivals like it Tencent Holdings Ltd. is now facing increasing pressure from regulators concerned about the speed at which they amass hundreds of millions of users and impact almost every aspect of everyday life. Alibaba’s share is down about 30% from its 2020 peak, battered by the deepening investigation and allegations of monopolistic practices at the crown jewel of billionaire Jack Ma’s empire.
Read more: Ant turns from a windfall to a nightmare for global investors
Beijing launched an antitrust investigation into Alibaba last week and sent officials to Hangzhou headquarters, marking the formal beginning of the Communist Party’s crackdown on the company that made Ma the country’s best-known entrepreneur. Sunday, Chinese regulators ordered Ma’s other online titan – Ant Group Co. – to return to its roots as a payment services provider, which threatens to slow the growth of its most lucrative consumer lending and wealth management businesses.
Ma, the flamboyant co-founder of Alibaba and Ant, has virtually disappeared from view since Ant’s IPO went off the rails last month. In early December, the man most identified with the rapid rise of China Inc. been advised by the government to stay in the country, a person familiar with the matter said.
Ma is not on the brink of personal doom, say those familiar with the situation. His very public rebuke is instead a warning that Beijing has lost patience with the inordinate power of its technology moguls, who are increasingly seen as a threat to the political and financial stability most praised by President Xi Jinping.
Read more: Jack Ma becomes silent after the spectacular demise of Ant Group