BEIJING, China, Jan 13 (Reuters) – Chinese tech giant Alibaba Group Holding Ltd has acquired minority stakes in two local units with special rights. (9988.HK)Business registration records show as Beijing expands campaign to tighten controls on online content.
Beijing was taken has had “golden shares” in private online media and content companies for more than five years, and in recent years has expanded such arrangements to companies with large data pools.
The stakes bought in Alibaba units in the past four months are the first for the e-commerce firm. Alibaba has been one of the most prominent targets of China’s two-year regulatory crackdown on tech giants.
These gold shares, usually equal to about 1% of the firm, are bought by government-backed funds or companies that gain board representation and/or veto rights for key business decisions.
In September last year, the investment vehicle of state-owned Zhejiang Media Group bought a 1% stake in Alibaba’s Shanghai-based Youku Film and Television unit, public business registration records showed.
Zhejiang Media Group also appointed Jin Jun, the general manager of one of its subsidiaries, to the board of its Alibaba unit, records show.
WangTouSuiCheng (Beijing), which operates under the China Internet Investment Fund (CIIF) established by the China Cyberspace Administration (CAC) in December, bought a 1% stake in the Guangzhou Lujiao unit of Alibaba’s main focus unit, separate business registration records showed. is “research and experience”.
The Financial Times, which first reported the WangTouSuiCheng investment on Friday, said the investment was aimed at strengthening control over content at the Beijing e-commerce giant’s Youku streaming video unit and UCWeb web browser.
Alibaba did not respond to a request for comment.
The FT also reports, citing unidentified sources, that the government is in talks to buy the gold shares of gaming giant Tencent Holdings. (0700.HK) this will include a stake in one of the group’s main subsidiaries. Tencent declined to comment.
Other companies that have such gold stock agreements include Full Truck Alliance Co (YMM.N)as well as Kuaishou Technology, mainland subsidiaries of TikTok owner ByteDance (1024.HK) and Weibo, Reuters previously reported.
Holding such golden shares could be useful when firms seek licenses to broadcast online news and display visual and audio programs online, sources told Reuters.
Reporting by Yingzhi Yang, Brenda Goh and Josh Horwitz; Additional reporting by Rishabh Jaiswal and Mrinmay Dey; Edited by Uttaresh.V, Rashmi Aich and Kenneth Maxwell
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