Jack Ma, Alibaba’s Billionaire Co-Founder, Resurfaces After Months of Lying Low

(WSJ)  Embattled billionaire Jack Ma made his first public appearance in nearly three months, speaking via a video link at a philanthropic event on Wednesday, easing speculation about his safety and whereabouts. 

Spokespersons for the Jack Ma Foundation and Ant Group Co., the financial-technology giant that Mr. Ma controls, confirmed a Chinese media report that said he gave a speech to a group of teachers from rural schools. 

“Jack Ma participated in the online ceremony of the annual Rural Teacher Initiative event on January 20,” the billionaire’s foundation said in a statement to The Wall Street Journal. 

The Hong Kong-listed shares of Alibaba Group Holding Ltd., which Mr. Ma co-founded, jumped on the news and closed 8.5% higher Wednesday.

The event saw Mr. Ma addressing 100 village teachers receiving accolades from the foundation. The ceremony is usually held annually in Sanya, a resort town in southern China, Mr. Ma said on the video. 

Mr. Ma appeared relaxed and said he was unable to meet the teachers in person this year due to the coronavirus pandemic. He said his commitments to education won’t change and added that he hoped to see them in the future.

Another video embedded in the same Chinese media report showed Mr. Ma on what it said was a recent visit to a primary school in Tonglu County, near Hangzhou, where Ant and its affiliate Alibaba are based. It didn’t specify when Mr. Ma, who was shown wearing a black cap and padded winter jacket, visited the school. 

It was the first time Mr. Ma has appeared in public since Oct. 24, when he gave a speech at a financial forum in Shanghai that drew the ire of regulators, who subsequently started scrutinizing his business empire. 

Days after his broadside against financial regulations in China, Mr. Ma and two top Ant executives were summoned by regulators to a closed-door meeting. On Nov. 3, Ant was forced to call off its initial public offerings in Hong Kong and Shanghai that were on track to raise more than $34 billion. 

The decision to pull the plug on what would have been the world’s largest IPO was made by Chinese President Xi Jinping, the Journal previously reported. 

Chinese authorities subsequently launched a probe into Alibaba for alleged anticompetitive behaviors on its e-commerce platform. 

Mr. Ma has kept a low profile since the Shanghai speech, sparking speculation about his whereabouts.

The 56-year-old has remained in mainland China and has been in Hangzhou, Beijing and Sanya, according to people familiar with the matter. Mr. Ma has also been in contact with close friends and leaders at Ant and Alibaba, one of the people said, adding that he chose to lay low. An Alibaba spokesperson declined to comment on his whereabouts. 

Mr. Ma oversaw Alibaba for two decades before stepping down in September 2019 as executive chairman, saying he wanted to return to education and focus on his philanthropic efforts. His namesake foundation was set up in late 2014 and provides aid to children in rural areas, young entrepreneurs, women’s development and environmental causes, according to its website.

Even though Mr. Ma has never held an executive position at Ant, which grew out of an online payments system within Alibaba, he has been highly influential and set the tone for how both Ant and Alibaba are run.

Employees at Alibaba and Ant cheered Mr. Ma’s re-emergence on Wednesday. An article on Alibaba’s internal forum about the philanthropic event drew hundreds of positive comments and tributes to Mr. Ma, according to people who went through the posts.

Even though Wednesday’s event was organized by Mr. Ma’s private foundation, “the company clearly wants to send a message that he’s OK and not in detention,” said Jamie Allen, secretary-general of the Asia Corporate Governance Association in Hong Kong, referring to Alibaba. 

He said Mr. Ma has been so integral to Ant and Alibaba’s successes and future prospects that it would have been better if Alibaba put out an official statement to reassure investors. “Putting out this video is an informal, yet not very appropriate way of doing so,” he said.

Beijing is seeking to shrink Mr. Ma’s business empire and the state could take a larger stake in his businesses, the Journal previously reported. 

Regulators are currently working to rein in Ant, which for years skirted the tough financial regulation that China’s banks and financial companies are subject to and found ways to expand rapidly and profit by facilitating a range of transactions without taking on much risk.

Alipay, Ant’s highly popular mobile payment and lifestyle app, expanded over the last decade to become a one-stop shop for many other financial services, including consumer loans, insurance and investment products. It has more than one billion users in mainland China. 

In late December, Chinese regulators chastised Ant and told it to rectify its business practices to comply with regulatory requirements, which will likely compel the company to put up significant amounts of capital to support its financial businesses. The company has formed a working group to address the problems that regulators have flagged and is says it is working quickly to meet the demands.

Mr. Ma’s recent appearance could help put to rest some of the unverified rumors about why he has been out of the public eye for months, said Jeffrey Towson, a former professor at Peking University’s Guanghua School of Management. 

“It was a necessary response to the question of ‘Where’s Jack Ma?’” said Prof. Towson. “Ma has such a high profile, his mere absence creates a lot of crazy ideas.” He added, however, that it is still unclear what is going on between Alibaba, Ant and the various regulators that oversee them. 

In a sign that regulatory pressure on Ant isn’t easing, the People’s Bank of China on Wednesday afternoon released draft rules for nonbank payment companies that could threaten Alipay’s dominant market position in China. 

The rules said companies that have a large share of the electronic payments market—either on their own or in combination with one or two rivals—could be deemed as having market dominance and could be broken up or face additional regulatory scrutiny. 

Alipay handled the equivalent of more than $17 trillion worth of digital payments transactions in the year to June of 2020, representing slightly more than half of the total digital payments market, according to disclosures in its IPO prospectus. Together with rival WeChat Pay, owned by Tencent Holdings Ltd. , the duo handle the vast majority of payment transactions through electronic wallets in mainland China. It isn’t clear if the new rules would cover other forms of electronic payments. 

Source: Wall Street Journal by Jing Yang

Jack Ma, Alibaba’s Billionaire Co-Founder, Resurfaces After Months of Lying Low Jack Ma, Alibaba’s Billionaire Co-Founder, Resurfaces After Months of Lying Low Reviewed by TechCO on 1/21/2021 Rating: 5

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