Home Technology Alibaba Group Holding Ltd Falls As Usmanov Starts Selling His Stake

Alibaba Group Holding Ltd Falls As Usmanov Starts Selling His Stake

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Alibaba shares fell 1.79% to $82.21 on Monday after Russian billionaire Alisher Usmanov said he had started winding up his stake in the Chinese e-commerce giant. Usmanov invested in the Hangzhou-based company about five years ago through Yuri Milner’s DST Global fund. In an interview with the state-run Rossiya-24 TV, Usmanov said Alibaba had returned him 5-6 times the investment.

Alibaba a financial investment for Usmanov

Last year, Usmanov of USM Holdings told CNBC that his investment in the Chinese online retailer had grown 500%. The Russian billionaire told Rossiya-24 TV that all his Chinese investments fall in two categories: strategic and financial. USM Holdings’ investments in Chinese smartphone maker Xiaomi and online retailer JD.com were strategic in nature.

Usmanov described Alibaba as a financial investment. “We have been largely exiting this company. We are selling out from this company at a high level,” he said. The Jack Ma-led company has seen a blockbuster IPO on the New York Stock Exchange (NYSE) and its shares rose to an all-time high of $120 in November 2014. But the stock has declined through 2015 amid concerns over the rampant sales of counterfeit goods on its platforms and a slowing Chinese economy.

Alibaba to hire 200 personnel to fight fakes

Usmanov has a net worth of $12 billion. Initially, he made money in the iron ore and steel sector before making some very successful investments in technology companies. He has invested in Twitter, and was an early investor in Facebook. The billionaire is now making investments in India, mainly in the e-commerce sector. Usmanov’s spokeswoman confirmed to Bloomberg that he had sold a portion of his stake in Alibaba.

The Hangzhou-based company said Monday that it would hire another 200 personnel to fight fake goods. Earlier this month, Alibaba narrowly escaped the US government’s ‘Notorious Markets List.’ The fresh recruits will cooperate with the government officials to crackdown on fake goods online. Alibaba already has 2,000 full-time employees and about 3,000 part-time volunteers to fight fakes. The company is also supporting the growth of self-developed brands online to reduce the number of counterfeit goods.

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