According to Mango Excellent Media Co Ltd (300413. SZ), an investment arm of Chinese e-commerce giant Alibaba Group Holding Ltd (9988. HK), which has been targeted in a regulatory crackdown, will divest its whole 5.01 percent share in the broadcaster.
The sale comes less than a year after the investment in December of last year, as Chinese regulators pursue huge internet companies for antitrust violations. Alibaba was a significant target, receiving $2.75 billion in penalties for anti-competitive activities.
The media business said in a filing to the stock exchange on Thursday that Alibaba’s investment arm would seek a release from a one-year lockup that it agreed to when it invested. Mango Excellent Media’s stock has dropped by over 40% since then. The company, which is situated in Hunan, China’s western region, creates Internet and television programming as well as having a shopping segment.
A request for comment from Alibaba was not returned. Since last October, when authorities abruptly blocked plans for Alibaba’s financial unit, Ant Group, to go public, the stock price has dropped by about half.
Alibaba is a key shareholder in Weibo Corp (WB.O), China’s social media counterpart of Twitter. Mango Excellent Media is one of several media-related projects sponsored by Alibaba. It also owns the South China Morning Post, Hong Kong’s most widely circulated English-language newspaper, in its whole. In an effort to assist Alibaba to divest, Weibo was in talks to go private with the support of a Shanghai-based state-owned firm. Following the publication of the story, the company’s chairman, Charles Chao, stated that no such negotiations had taken place. Alibaba owns holdings in certain small Chinese internet media and has its own filmmaking company, Alibaba Pictures, in addition to Weibo.
