Alibaba’s headquarters in Hangzhou, China, on Wednesday, November 10, 2021.
Whole Shen | Bloomberg | Getty Images
Published in Hong Kong, shares of Alibaba rose nearly 10% on Tuesday after Chinese e-commerce giant said it would increase the size of its share repurchase program from $ 15 billion to $ 25 billion.
The share repurchase scheme will run for two years until March 2024, the company said.
As part of a previously announced buyout program, Alibaba bought back about 56.2 million U.S. Depositary Shares (ADRs) worth about $ 9.2 billion. ADRs are listed in the US and act as proxies for foreign companies.
The Hangzhou-based e-commerce giant is looking to boost investor confidence as its shares lost about two-thirds of their value after reaching an all-time high in October 2020.
“Alibaba’s share price does not adequately reflect the company’s value, given our sound financial and expansion plans,” Toby Xu, the company’s deputy chief financial officer, said in a statement.
Alibaba has faced a number of challenges, including macroeconomic barriers and continued tightening of regulation by the Chinese government, which led to the fact that last year the authorities imposed an antitrust fine of $ 2.8 billion on the company.
Over the past 14 months, China has introduced extensive new rules in the technology industry, often without warning. The moves have shaken investor confidence and wiped out billions of dollars from the country’s giants that are on the stock market.
On Tuesday, Alibaba also appointed Weijiang Shan, executive chairman of the Hong Kong-based PAG investment group, to its board as an independent director starting March 31. Shan will be a member of the audit committee of the board of directors. He will replace Boryo Ekholm, CEO of telecommunications equipment giant Ericsson, who will step down from the board of Alibaba.