China has purchased ‘golden shares’ in tech companies Alibaba and Tencent in an effort to broaden its efforts to tighten control over online content, according to business registration data. Beijing began purchasing these ‘golden shares’ in private online media companies more than five years ago. In most cases, China acquires special rights to 1% or less of a company.
The government-backed funds or companies that purchase the golden shares receive a board seat and the ability to reject important business decisions, giving the owner greater control over management changes than ordinary shareholders.
The shares acquired during the past four months in the Alibaba units are the first ones to be made public for the e-commerce company.
Notably, Alibaba remained one of the most prominent targets of China’s two-year-long regulatory crackdown on tech giants.
Last year in September, an investment vehicle of state-owned Zhejiang Media Group took a 1% stake in Alibaba’s Youku Film and Television unit, the pblic business registration records showed.
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