World’s Rich Fled Alibaba After Monopoly Probe, Citi Says
(Bloomberg) - Wealthy investors rushed to buy shares in Alibaba Group Holding Ltd. after China launched an investigation into alleged monopoly practices at the internet giant of billionaire Jack Ma, according to Citigroup Inc.'s private bank.
"A large number" of the bank's ultra-wealthy customers have cut or abandoned their stakes in China's largest e-commerce company after reports of the investigation were released, the Citi Private Bank's family offices laboratory said in a report released Tuesday With. China's stock market saw significant inflows from the company's richest customers in the second half of the previous year, according to the report.
Alibaba and rivals like Tencent Holdings Ltd., once hailed as the drivers of economic prosperity and symbols of the country's technological prowess, are facing increasing pressure from regulators after they have amassed hundreds of millions of users and influence almost every aspect of daily life won in China. The $ 35 billion IPO of Alibaba's subsidiary Ant Group Co. was abruptly halted last year, which helped Alibaba's US depository receipts have fallen more than a fifth since late October.
Read more: China halts Ant Group IPO, throws Ma Empire into turmoil
The Central Bank of China said last week that Ant Group is working on a schedule to overhaul its business while ensuring that business operations continue. This underscores Ma’s determination to contain Ma’s business and gives little insight into how far the company will have to go to reassure Beijing. Ant Group accounts for more than a quarter of Ma's $ 52.9 billion in assets, according to the Bloomberg Billionaires Index.
Alibaba shares rose 1.2% at 9:55 a.m. in Hong Kong on Wednesday.
(Updates Ma's fortune in paragraph four, adds stock movement in last)
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