- Jack Ma, founder of Alibaba, has decided to postpone plans to reduce his stake in the Chinese e-commerce giant amidst a decline in the share price. Despite regulatory filings indicating his intention to sell 10 million shares valued at around $870 million, Ma has refrained from selling any shares, as Alibaba's stock is currently trading below the company's perceived value, according to Alibaba's Chief People Officer, Jane Jiang.
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The disclosure of Ma's plans coincided with Alibaba's decision, announced on November 16, to abandon the spinoff of its cloud computing business, resulting in a 9% drop in shares. Meanwhile, the decision to sell shares was made in August, when Alibaba's US listed shares were trading at a higher value of $101. With the recent closing price at $78.94, selling 10 million shares would yield around $789.4 million, below the initially sought $870 million. Jiang emphasizes that Ma's intention to sell at a higher price reflects his confidence in the business, showcasing a strategic approach aligned with market dynamics.
Why it matters
Alibaba, navigating a transformative year marked by a company split into six business groups and a change in CEO, continues to adapt to the evolving landscape of the Chinese technology sector. Amidst a broader regulatory crackdown on China's technology sector, Jack Ma and his business empire have faced increased scrutiny. Ma, now dedicated to teaching and research in areas such as agricultural science, remains a central figure in Alibaba's strategic decisions and the company's response to industry challenges.
