Meme stock investor urges Alibaba to accelerate share buybacks

Ryan Cohen, who typically invests in meme stocks, is urging Alibaba to accelerate its share buyback plan after acquiring a minority stake in the Chinese e-commerce group.

The exact amount of the stake could not be determined, but according to people familiar with the matter, it is worth hundreds of millions of dollars. Cohen began lobbying Alibaba, which has a market cap of more than $300 billion, in the second half of last year, it said.

Cohen is one of the most prominent figures in the retail boom and has been behind the stock market rallies of companies like GameStop and Bed, Bath and Beyond.

News of his position, first reported by The Wall Street Journal, comes a few months after Alibaba announced it would add $15 billion to its share buyback program, which runs through the end of fiscal 2025.

It's unclear how influential Cohen was in getting Alibaba to act given how large his stake is relative to the company's market value. However, its popularity among social media-savvy retail investors could force the company to pay more attention to its claims to avoid being targeted by its followers.

A representative for Cohen declined to comment.

Alibaba has struggled with issues of late, in part due to the impact of China's strict zero-Covid lockdowns hurting consumer spending, as well as a tougher regulatory environment in its home market. Alibaba paid a record $2.8 billion antitrust fine in 2021 and pledged to end the practice of forcing some of its sellers to stay away from competing e-commerce platforms.

Alibaba's share price has fallen more than 60 percent since its peak in late 2020 due to various headwinds, including government intervention that blocked sister company Ant Group's IPO two years ago.

Cohen built his fortune as a co-founder of Chewy, the pet supply retailer which he sold for $3.35 billion in 2017. In January 2021, he joined GameStop's board of directors after disclosing a 13% stake in the company and helped the company's stock price skyrocket in what many believe to be one of the catalysts for the meme- Watch the retailer's stock rally.

The 37-year-old's investment in a Chinese company comes at a time when many investors have reduced their exposure to the country following Beijing's tech crackdown.