Alibaba Group's (BABA) - Get Alibaba Group Holding Ltd. Sponsored ADR Report U.S.-listed shares slumped to a two-and-a-half year low Friday as the region's most valuable tech company again found itself in the crosshairs of China's ongoing corporate crackdown.
Mango Excellent Media Co. said Thursday that Alibaba will divest its entire 5.01% stake, which was acquired in December of last year, as it seeks a waiver to a lock-up agreement. The sale comes amid a broader crackdown on corporate profits in China, which has been particularly focused on Alibaba, given both its links to billionaire Jack Ma and its holdings in Asia's media market, including the South China Morning Post.
Earlier this year, Beijing regulators fined the group a record $2.8 billion as part of a far-reaching anti-monopoly probe, with China’s State Administration for Market Regulation said some of its practices "infringe on the businesses of merchants on the platforms and the legitimate rights and interests of consumers."
Alibaba shares were marked 4% lower in early Friday trading to change hands at $145.00 each, a move that would lop more than half of the group's market value since its record high of $319.32 in October of last year.
China-based companies with U.S. listings were also trading lower, with JD.com (JD) - Get JD.com, Inc. (JD) Report falling 3.25% to $73.67 and Baidu (BIDU) - Get Baidu, Inc. Sponsored ADR Class A Report falling 2.34% to $156.74 as concerns over the spillover impact of China Evergrande's potential bond default bled into early Friday trading.
Alibaba posted better-than-expected first quarter earnings last month, as group revenues rose 34% to $31.8 billion, but has felt the heat of Beijing's crackdown on sectors including video games, educational tutoring and cryptocurrency trading over the past few months.