Alibaba headquarters in Hangzhou, China, on Wednesday, November 10, 2021.
Kelay Shane | Bloomberg | Getty Images
Ali Baba Hong Kong-listed shares closed more than 11% on Tuesday after the Chinese e-commerce giant said it would increase the size of its share buyback program from $15 billion to $25 billion.
The company said the stock buyback plan will be in place for two years, through March 2024.
Ali Baba He repurchased about 56.2 million American Depositary Shares (ADRs), worth about $9.2 billion, under a previously announced buyback program. ADRs are incorporated in the United States and act as agents for foreign companies.
The Hangzhou-based e-commerce giant is looking to boost investor confidence as its shares have lost nearly two-thirds of their value since hitting an all-time high in October 2020.
“Alibaba’s share price does not fairly reflect the value of the company in light of our aggressive financial and expansion plans,” Toby Xu, the company’s deputy chief financial officer, said in a statement.
Alibaba has encountered a number of issues including Macroeconomic headwinds And continued regulatory tightening from the Chinese government, which prompted the authorities to slap the company with A $2.8 billion antitrust fine last year.
China has introduced sweeping new rules across the tech industry, often without warning, over the past 14 months. These moves have shaken investor confidence and removed billions of dollars from the country’s publicly-listed giants.
On Tuesday, Alibaba also appointed Weijian Shan, chief executive of Hong Kong-based investment group PAG, to its board of directors as an independent director, effective March 31. Chan will serve on the Board’s Audit Committee. He will replace Börje Ekholm, CEO of the telecom equipment giant Ericssonwho will retire from Alibaba’s board of directors.
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