Tencent’s largest shareholder is Prosus (30.99%), South Africa. SoftBank is currently the largest shareholder in Alibaba with 25% of shares outstanding. Another factor could be consumer internet companies that China is penalizing have large degrees of foreign ownership.Government frets about Fintech’s “information monopoly” Ant Group and Tencent claim over a 90% share of China’s mobile payment market, allowing them to collect a vast amount of consumer data. China’s leaders famously want to prevent the emergence of alternative centers of power. Some observers see this as an antitrust campaign, similar to the ones going on in the U.S.That makes it very hard to figure out why it’s happening. Outside China’s byzantine, opaque nexus of party, government, and big business, it’s very difficult to figure out what’s going on. This kept the Emperor the supreme power while European monarchies lost relative ground to the bourgeois. Tracing a little back into the history, China led Europe in many respects in the 16th century, but the Emperor recognized (correctly) that the rising merchant class was a threat to his power and reined it in. The Chinese government called video games “spiritual opium”, sending video game stocks plunging, and very recently China’s banking and insurance watchdog stepped up its regulation of online insurance companies.Ĭhina’s largest tech firms have shed at least $800 billion in market value since February. New Oriental Education & Technology Group plunged as much as 40 percent in Hong Kong, extending the previous day’s record 41 per cent fall. Banning companies from making profits, raising capital or going public. China unveiled a sweeping overhaul of its $110 billion EdTech sector, under which all institutions offering tuition on school curriculum will be registered as non-profit organisations. In June 2021, the “worst-case became a reality” for the Education sector. Later banned the company from taking on new customers and ordered mobile stores to remove its apps. Just days after Didi’s (China’s Uber) $4.4-billion initial public offering in the US, Chinese regulators announced they were reviewing the company on “national security grounds”, and started levying various penalties against it. Around $40 billion of its value was wiped out in a fortnight after China’s State Administration for Market Regulation (SAMR) opened an investigation into its “suspected monopolistic practices” and on the announcement of “new worker protection rules”.Ĭhinese Regulators were far from “done”, yet. That’s more than 10 Byju’s, India’s biggest startup, which is valued at $16.5 billion.įood delivery app, Meituan suffered a similar rout in April of this year. Tencent had $170 billion shaved off its value. Pony Ma, the Chairman, and CEO of Tencent, who “obediently” bowed down to the Chinese leadership, has lost even more money than the obstreperous Jack Ma in the recent crackdown. Leaders of top tech companies (also including ByteDance, the company that owns TikTok) were summoned before regulators and presumably berated. The government then embarked on an “antitrust” push, fining Tencent (China’s biggest social media company) and Baidu (one of the top Chinese internet companies) - for various past deals. Barely a day goes by without more news on the widening scope of Beijing’s crackdown on private enterprise. Since then, Canceled share sales, Ruined business models, Tech moguls brought to heel, became the new normal. The value of Ma’s business empire collapsed. The government levied a multi-billion dollar antitrust fine against Alibaba, deleted its popular web browser from app stores, and Jack Ma, the founder of e-commerce giant Alibaba, went out of the public eye for weeks. Days before Alibaba’s (which is sometimes compared to Amazon) subsidiary Ant Group was set to raise up to $34 billion in an IPO which would have been the world’s largest public offering, beating the $29.4-billion listing of Saudi Aramco in late 2019, the Chinese government effectively canceled the IPO of Ant Financial.
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