The whereabouts of founder Jack Ma have been a mystery since the Chinese Communist Party authorities halted Ant Group’s IPO and launched an anti-monopoly investigation into Alibaba. There are indications that the investigation may have been elevated to a political matter, as the authorities are also heavily censoring media reports on the matter.
Alibaba founder Jack Ma has not been seen in public for more than two months, and his recent absence from the “Africa Startup Competition” he founded has drawn widespread attention from Western media.
The Financial Times reported that the Beijing government has instructed the media to follow the official line in reporting the Ali anti-monopoly news and not to analyze it further without permission, and has banned the media from reporting and reprinting any stories that oppose the official position, or quoting foreign media reports.
Alibaba Under Antitrust Investigation by Chinese Regulators
Recent Chinese politicians have criticized, without naming names, the suspension of Ant’s listing in relation to The prevention of systemic risk, which may lead to a large number of bad credit debts if a single data finance platform has too large a market share. Economist Luo Jiacong, however, reckons that the current regime has deeper concerns.
Luo Jiacong: “The Chinese Communist Party may think that the platform owned by Ant and Ali has most of the data in the country, (almost) everyone’s information, and involves a huge amount of money, so they can use this platform to get a lot of money, etc. Basically, they have the bargaining power with the current regime. I guess the CCP is very wary, especially with the recent spate of rumors about the CCP’s unstable status and so on. Their handling of Ma is not only anti-monopoly, but they can’t rule out the possibility of a threat to their regime.”
Beijing’s directive to Ali is similar to the Bo Xilai case
Some analysts say Beijing’s directive is both harsh and unusual, using wording similar to the restrictions imposed by China on news coverage of important political events, such as the Bo Xilai case.
Luo Jiacong: “The order to strictly follow the line, I guess, is not just an economic phenomenon, but may be (seen as) a political threat. Politics has always been the primary concern of the CCP, and everything is political above all else. The guess is that behind the scenes it has characterized this as a political incident far more than an economic or financial one.”
Ant Group’s IPO called off
The Wall Street Journal reported earlier that long before the Ant IPO was called off, Ma had offered to hand over part of his stake in Ant Group to the central government to save the relationship with it. If the state needs it, it can take away any platform of Ant. The report cited sources as saying that regulators are currently unable to decide whether to accept Ma’s offer and are considering imposing stricter capital and leverage requirements on Ant.