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(Bloomberg) – Alibaba Group Holding Ltd. rose to its highest value in six months on news that co-founders Jack Ma and Joseph Tsai bought about $200 million in stock in China It was a positive signal for investors as stocks weathered the market crash.
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China’s e-commerce pioneer Ma, a once outspoken billionaire who retreated from public life after the Chinese government cracked down on the empire in 2020, lost about 5,000 in the fourth quarter. The Chinese e-commerce pioneer rose 8% after the New York Times reported it had bought $10,000 in shares. His longtime close friend Tsai, now the company’s chairman, acquired about $150 million in stock through his family’s investment vehicle, according to securities filings.
The revelations come as investors grapple with doubts over China’s post-coronavirus turnaround and the market crash that has devastated the world’s second-largest economy. Alibaba, which once defined e-commerce in China, has lost more than 40% of its value over the past year as it has lost market share to rivals such as PDD Holdings and undergone a management shakeup. The rise coincided with a 5% rise in the Nasdaq Golden Dragon China Index of U.S.-listed Chinese stocks after Bloomberg reported that the Chinese government was preparing a $278 billion market rescue package.
Alibaba’s woes, along with the sudden departure of former chief executive Daniel Zhang, have fueled speculation that Ma himself may become more directly involved in the company. The co-founders have stepped up their public activities in recent months, but it’s still a far cry from when they were regulars at global conferences.
In November, Mr. Ma, perhaps China’s best-known entrepreneur, broke his years of silence and issued a call to arms for his workers. On an internal bulletin board, he urged Alibaba to “correct course” and praised PDD for taking market share with its hit shopping app Temu. Mr. Ma said that with determination and hard work, Alibaba will be able to succeed again.
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It’s unclear whether Ma’s latest move marks a shift from his longstanding stance of gradually selling off company stock while focusing on his own projects. He disclosed plans to release 10 million shares worth about $870 million on Nov. 21, according to a filing last year.
But for a company that once surpassed China and ranked as one of the world’s largest companies by market capitalization, it is at a critical juncture.
Tsai and new CEO Eddie Wu are trying to turn around Alibaba after a series of missteps and regulatory oversight undermined its dominance. The company, a symbol of Chinese business that has endured post-COVID-19 consumption volatility and years of harsh government crackdown, now has to contend with the rise of rivals such as PDD and ByteDance.
Last year, the company announced plans to split itself into six parts, but later withdrew those plans at the same time as Zhang was fired. It canceled an $11 billion spinoff of its cloud division that some investors had hoped for, declaring the company needed a “reset.”
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Mr. Ma and Mr. Tsai have both bought up shares in Alibaba in recent months as its stock price plummeted, The New York Times reported, citing unnamed people familiar with the matter.
Tsai’s Blue Pool Management bought about 2 million U.S.-listed shares of Alibaba worth about $152 million in the fourth quarter, according to filings. This is the first time Tsai’s fund has bought Alibaba stock since at least the final quarter of 2017, according to a review of regulatory filings.
Ma, who stepped down as executive chairman in 2019 but remains a major shareholder, bought $50 million worth of stock during the quarter, The Times reported, citing people familiar with the matter.
–With assistance from Antonia Mufarech, Brian Chapatta, and Vlad Savov.
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