Just months after purchasing a stake in one of China’s largest television broadcasters, Alibaba is selling its stake. As the business faces increasing pressure from the government to reign in Big Tech’s power and influence.
According to a statement released by Mango Excellent Media on Thursday, Alibaba (BABA) intends to sell its 5% investment in the media company. It owns Mango TV, which is well-known in China for its variety shows. Hunan Broadcasting System, China’s second-largest state-owned television network, owns 56 percent of Mango.
Alibaba is also seeking a waiver from an agreement not to sell the shares for a year, according to the statement. They were only purchased nine months ago for 6.2 billion yuan ($960 million) by the e-commerce behemoth.
Alibaba has already incurred a hypothetical loss of around 2 billion yuan ($320 million) on the investment, based on Mango Excellent’s stock price on Friday.
The statement made no mention of Alibaba’s plans to leave Mango. Alibaba did not respond to a request for comment right away.
Alibaba, founded by Jack Ma in 1999, is under severe political and regulatory pressure from Beijing, which has been cracking down on the internet industry since late last year.
Beijing is growing concerned about huge, private tech firms’ dominance in media, banking, data, and other sensitive industries, as well as how integrated they have grown into daily life in China through news, digital payment apps, and other services.
While e-commerce is Alibaba’s mainstay, the company has grown into a variety of businesses throughout time. It has built a massive media empire, with large investments in China’s most popular social media and online video platforms, including Weibo (WB), Youku, Bilibili (BILI), Xiaohongshu, and Qutoutiao (QTT), as well as China Business Network, a state-owned financial news channel.
Alibaba also owns Hong Kong’s leading English-language daily, the South China Morning Post, which it purchased in 2015.
Beijing had pushed Alibaba to sell its media assets earlier this year, according to the Wall Street Journal, because officials were concerned about Alibaba’s influence on public opinion.
A highly anticipated IPO by Alibaba’s finance unit, Ant Group, was put on hold by regulators in November. President Xi Jinping stated in December that one of his top priorities for 2021 would be to strengthen anti-monopoly regulations for internet companies. Regulators announced an antitrust inquiry into Alibaba a few days later.
The antitrust police fined Alibaba a record $2.8 billion in April. Banking regulators also forced Ant Group to reduce and restructure its operations.
Throughout it all, Ma, who left the firm in 2019, has mainly remained out of sight. He disappeared for months before reappearing in a video early this year to address teachers at a humanitarian event.