Jack Ma's fortune jumps $3.1b after record Alibaba fine

NEW YORK • China just slapped a record antitrust fine on Alibaba Group Holding. The company thanked the government and investors breathed a sigh of relief.

Alibaba's American depositary receipts climbed 9.3 per cent on Monday in New York, their biggest jump in almost four years.

For founder Jack Ma, it meant his fortune increased by US$2.3 billion (S$3.1 billion) to US$52.1 billion, according to the Bloomberg Billionaires Index.

The US$2.8 billion fine is less severe than some investors feared and is based on only 4 per cent of the company's 2019 domestic sales, far less than the maximum 10 per cent allowed under Chinese law.

While the Internet giant will have to adjust the way it does business, its executive vice-chairman Joe Tsai said regulators will not impose a radical overhaul of its e-commerce strategy, and its chief executive Daniel Zhang declared Alibaba ready to move on.

"Alibaba would not have achieved our growth without sound government regulation and service, and the critical oversight, tolerance and support from all of our constituencies have been crucial to our development," the company said in an open letter. "For this, we are full of gratitude and respect."

Mr Ma has lost billions since his nation's regulators began an anti-monopolistic campaign, halting the US$35 billion initial public offering (IPO) of his Ant Group payments company just two days before it was scheduled to go public.

Separately, China's central bank ordered Ant to become a financial holding company that will be regulated more like a bank.

The move, announced on Monday, will have far-reaching implications for the firm's growth and its ability to press ahead with an IPO.

Alibaba shares opened 3.4 per cent higher in Hong Kong yesterday.

BLOOMBERG