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HomeHollywood NewsChina Instructs Alibaba to Sell Off Media Assets (Report)

China Instructs Alibaba to Sell Off Media Assets (Report)

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Regulatory pressure on Jack Ma’s business empire has been steadily increasing, according to insiders quoted by the Wall Street Journal, but the sale of the Tech Group’s entertainment holdings may not be “necessary” yet. For Jack Ma’s entangled Alibaba Group Holdings, this problem is far from over. According to a report by The Wall Street Journal, the Chinese government has asked the company to sell its vast collection of media assets.

The request represents another extension of the regulatory pressure imposed on Ma’s e-commerce, entertainment, and fintech empire following Ant Financial’s spectacular failure to go public last November. The crackdown on Alibaba’s media holdings began earlier this year when Chinese authorities had fully audited the technical group’s wealth collection.

According to the journal’s sources, “officials had said on how much Alibaba’s media interests have expanded” and requested the company to come up with a plan to cut back on its holdings. According to the country’s authoritarian government, Beijing was reportedly considered dangerous by Alibaba’s potential network of media properties in China, that it could bestow it on public opinion in China – only to be welcomed by the Chinese Communist Party.

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Over the years, Alibaba has amassed a huge portfolio of bets and ownership positions in influential media and entertainment companies at home in China and abroad, as they provide business synergies with consumers for such touchpoints firm’s core e-commerce business can do.

Journal sources said that Chinese officials were primarily concerned about Alibaba’s news and social media interests, but they also reviewed the company’s large portfolio of entertainment holdings. People familiar with the discussions said, “External division may not be necessary for that part of Alibaba’s business.”

On the news and social media side, Alibaba and Ant themselves: 100 percent of the South China Morning Post, the region’s leading English newspaper; Weibo’s 30 percent, China’s version of Twitter; 37 percent of the influential Chinese news organization Yicai Media Group; 5.3 percent of China’s largest offline advertising network, Focus Media; And others.

On the entertainment side, Alibaba owns the Hong Kong Stock Exchange-listed Alibaba Pictures Group, which includes a movie studio, the popular Tao Piao Piao ticketing app, and online video giant Youku. The company also has stakes in major Chinese studios including Steven Spielberg’s Amblin Entertainment, and Huayi Brothers Media, Bona Film Group, Hehe Pictures, and two of China’s biggest exhibitors, Wanda Pictures and Dadi Cinemas.

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The company is also 6.7 percent youth-oriented video service Bilibili and 5 percent Mango Excellent Media, a popular online video subsidiary of state-backed TV network Hunan TV. The company has also invested in several Hollywood action films, such as Paramount’s Mission Impossible franchise.

Ma’s crisis began in late October 2020, when he made the now-infamous speech that plunged his business empire into turmoil. Addressing a collection of business leaders and government data at a financial conference in Shanghai, Ma strongly criticized China’s regulators and state-owned banks for their backwardness, while for companies such as his fintech firm Ant Financial Advocated more and more leeways and room for innovation, which was determined. Just a few days after the IPO.

The comments affected China’s Communist Party leadership, with Chinese President Xi Jinping personally ordering the cancellation of the adjacent blockbuster public offering. Ant is expected to raise at least $ 34 billion, Ant’s IPO will be its biggest stock-m arket debut in history. Since then, the clouds have only darkened more for Ma and Alibaba.

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In late December, Chinese regulators explicitly announced that they were launching an antitrust investigation into Alibaba’s flagship e-commerce business, as well as implementing new regulations to stop Ant’s business activities. Antitrust regulators are reportedly preparing to hit Alibaba with a record fine of $ 975 million for allegedly anticompetitive practices on the company’s e-commerce platform.

Sources in the Journal said that it was unclear whether Alibaba would have to sell its media assets or its entire portfolio in the category. But any plans of the company will be carefully reviewed and will require the sign-off of senior government leadership.

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