Hong Kong (CNN Business)Alibaba is dumping its shares in one of China’s largest TV broadcasters just months after it bought them, as the company comes under growing pressure from a government campaign to rein in Big Tech’s power and influence.
Alibaba (BABA) plans to sell its 5% stake in Mango Excellent Media, according to a statement from the media company on Thursday. It owns Mango TV, which is massively popular for its variety shows in China. China’s second largest state-owned television network, Hunan Broadcasting System, controls Mango with a stake of 56%.The statement also said that Alibaba is seeking a waiver from an agreement not to sell the shares for a year. The e-commerce giant bought them only nine months ago for 6.2 billion yuan ($960 million).
Based on Mango Excellent’s stock price on Friday, Alibaba has already suffered a notional loss of about 2 billion yuan ($320 million) from the investment.
The statement didn’t provide any reason for Alibaba’s plans to exit Mango. Alibaba didn’t immediately respond to a request for comment.
Xi Jinping renews call for crackdown on Chinese tech companiesRead MoreThe planned sale comes as Alibaba, founded in 1999 by Jack Ma, faces enormous political and regulatory pressure from Beijing, which has intensified a crackdown on the internet industry since late last year.Beijing has become increasingly concerned about the clout that big, private tech firms have over media, finance, data, and other sensitive sectors, and how entrenched they have become to everyday life in China through news, digital payments apps and other services. While Alibaba’s mainstay business is e-commerce, the company has expanded into a variety of industries over the years. It has assembled a big media empire, owning major stakes in the country’s most popular social media or online video platforms, such as Weibo (WB), Youku, Bilibili (BILI), Xiaohongshu, and Qutoutiao (QTT), as well as in China Business Network, a state-owned financial media outlet. Alibaba also owns the South China Morning Post, Hong Kong’s leading English-language newspaper, which it bought in 2015.Earlier this year, the Wall Street Journal reported that Beijing had asked Alibaba to dispose of its media assets, as officials were concerned about its sway over public opinion.
Jack Ma's Ant Group was the next big thing. Now it may become just a boring bankLast November, regulators shelved a highly anticipated IPO by Alibaba’s financial affiliate, Ant Group. In December, President Xi Jinping said that stronger anti-monopoly rules against internet firms would be one of his most important goals for 2021. Days later, regulators announced an antitrust investigation into Alibaba.
In April, Alibaba was fined a record $2.8 billion by the anti-trust watchdog. Ant Group was also cut down to size and ordered by the banking regulators to overhaul its operations.Ma — who retired from the company in 2019 — has largely remained out of sight through all of this. He vanished from public view for months before briefly emerging in a video earlier this year to speak to teachers at a philanthropic event.
Source: edition.cnn.com
