June 23, 2024

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Jack Ma Buys Alibaba Stock to Show Support for Struggling Empire

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(Bloomberg) — Alibaba Group Holding Ltd. gained its most in six months after billionaire co-founder Jack Ma bought stock, a much-needed boost for a company weathering internal turmoil and a stock market rout.

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China’s e-commerce pioneer gained as much as 6.7% in Hong Kong, after climbing 8% in New York. Ma, the once-outspoken billionaire who retreated from public view after Beijing clamped down in 2020, bought about $50 million of stock last quarter, a person familiar with the situation said. Chairman Joseph Tsai — Ma’s longtime confidante — also separately bought about $150 million of shares in his first such purchase since 2017.

The revelation emerged as doubts persist about China’s post-Covid turnaround, helping trigger a market rout that’s hammered swathes of the world’s No. 2 economy. Alibaba itself lost more than 40% of its value over the past year, as the company that once defined Chinese e-commerce lost market share to PDD Holdings Inc. and underwent a management reshuffle. Tuesday’s US rally coincided with a 5% gain in a key gauge of US-listed Chinese stocks, after Bloomberg reported Beijing was readying a $278 billion market rescue package.

Alibaba’s woes, as well as the surprise exit of former Chief Executive Officer Daniel Zhang, spurred speculation that Ma himself may get more directly involved with his company. The co-founder has in recent months stepped up public activity, though it remains a far cry from the days when he was a regular on the global conference circuit.

“This could be iconic given Jack Ma’s image and it could boost market confidence in the short term. And it should be the first purchase by Jack Ma since eight years ago,” said Willer Chen, an analyst at Forsyth Barr Asia Ltd.

Read More: Alibaba Ousts Commerce Chief, Splits Assets in New Shakeup

“But for Alibaba, the major question is still how the company will compete with PDD and regain its growth,” he added.


2024-01-23 21:48:06

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