Alibaba’s top investors swap US ADRs for Hong Kong shares as fund managers take steps to avoid potential sanctions
- Temasek, Baillie Gifford, and Matthews Asia are among the major shareholders that have swapped stakes in the Chinese e-commerce giant
- Stock shifts are a sign that the Trump administration’s fierce rhetoric against Chinese tech firms is prompting investors to take steps to avoid the potential fallout
Several of Alibaba Group Holding’s biggest investors have converted billions of dollars in US shares for Hong Kong stock in part to avoid potential US sanctions and delistings of major Chinese technology companies.
Alibaba owns the South China Morning Post.
“Lots of long-term fund managers, especially the ones whose fund managers are based in Asia, are switching or considering switching from ADRs into Hong Kong-listed shares,” said Nelson Yan, head of offshore capital markets investment at Creditease Wealth Management (Hong Kong), referring to American depositary receipts. “Demand for these ADRs in the US is now clouded by the politics.”
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Chinese e-commerce giant Alibaba starts trading on Hong Kong stock exchange
Baillie Gifford, whose partner and portfolio manager James Anderson told Bloomberg Television in March that Alibaba could become a US$2 trillion company, swapped 10.4 million US-listed shares worth about US$2.67 billion in the second quarter. That’s about a fifth of its stake, and is the biggest change since it first bought shares in 2014.