by Kiyoshi Takenaka and Ankur Banerjee
SHANGHAI (Reuters) – Japanese technology investor SoftBank has decided to sell almost all of its stake in Alibaba, according to a report from the Financial Times (FT).
Stock documents show that SoftBank’s stake in the Chinese e-commerce giant would drop from nearly 15% to 3.8%, the British newspaper reported on Wednesday evening.
On the Hong Kong Stock Exchange, Alibaba lost up to 5.15% in the session before closing on a decline of 1.98%. SoftBank fell 0.97% in Tokyo.
The Japanese group – which invested more than 20 years ago in Alibaba spending just $20 million – has already sold around $7.2 billion worth of shares in the group this year through prepaid futures. , according to information from the Financial Times.
SoftBank said the transactions reflected a shift to “defensive mode” in the face of an uncertain business climate and that it would provide details when it releases its quarterly results in May, according to the FT.
Neither SoftBank nor Alibaba responded to Reuters requests for comment.
Valuations of big Chinese tech companies have started to recover this year after two years complicated by heightened surveillance from Beijing.
Compared to the highs reached at the end of 2020, giant Alibaba has lost more than two-thirds of its valuation as a result of regulations in the technology sector.
“China’s regulatory environment in the internet industry has tightened significantly in recent years and SoftBank is only responding to this development,” said Shinji Moriyuki, an analyst at SBI Securities. “It is quite possible that the proportion of Chinese stocks in portfolios will decline further.”
SoftBank raked in $34 billion last year by cutting its stake in Alibaba from 23.7% to 14.6% as the company sought to shore up its cash reserves in the face of steep losses posted by its Vision investment fund fund.
Further illustrating the pressure on China’s big tech names, Tencent (owner of WeChat messaging service, among others) lost 5.2% on Wednesday after its largest shareholder, Dutch investment group Prosus, announced that it would could continue its withdrawal from the group.
(Shanghai office, Laetitia Volga, edited by Blandine Hénault)
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