JD.com founder donates more than $2 billion in stock

JD.Com CEO Richard Liu. Photo: Reuters
JD.Com CEO Richard Liu. Photo: Reuters

Summary

  • CEO Richard Liu is the latest Chinese billionaire to make a sizable donation to charity during Beijing’s regulatory crackdown on the country’s tech sector

Richard Liu, founder and chief executive officer of Chinese e-commerce giant JD.com Inc., is giving billions of dollars of stock to charity, the latest member of the country’s business elite to make a large donation amid a government crackdown on China’s tech sector.

Mr. Liu plans to donate 62.4 million shares to a third-party charitable organization, the Beijing-based company said in a filing with the U.S. Securities and Exchange Commission.

U.S.-traded shares of JD.com closed at $75.08 on Tuesday. Each of these so-called American depositary receipts represents two underlying shares in the company, valuing the stake Mr. Liu plans to donate at approximately $2.34 billion.

The company disclosed the move on the second day of the Lunar New Year, a holiday celebrated throughout China. ADRs were down 1.4% as U.S. markets opened on Wednesday.

Since Mr. Liu founded JD in 2004 as an online sales platform for electronics, the company has grown into an e-commerce titan with more than $100 billion in annual revenue. In September, JD named its first corporate president, paving the way for Mr. Liu—who is also known by the Chinese name Liu Qiangdong—to step back from day-to-day business.

China’s biggest internet companies have been facing broad scrutiny from Beijing officials over issues ranging from antitrust to national-security concerns. Concurrently, a growing number of Mr. Liu’s peers among the country’s top tech executives have been giving some of their wealth to charity, often in the form of stock.

Last year, Meituan founder Wang Xing and Xiaomi Corp. founder Lei Jun both made sizable donations. Mr. Wang, whose company runs a delivery platform, gave more than $2 billion of shares in Meituan to his charitable foundation. Mr. Lei’s donation of shares in Xiaomi, a smartphone and consumer-electronics company, was valued at about $2.2 billion.

In 2020, Pinduoduo Inc. founder Colin Huang and his founding team gave a 2.37% stake in the company to a philanthropic vehicle. ByteDance Ltd. founder Zhang Yiming has also given tens of millions of dollars to charitable causes.

Analysts say the donations could be a response to a string of moves by China’s government to push back against the power of the country’s largest tech companies. Reducing the country’s wealth gap is one aim of the government’s program.

Other high-profile companies in China’s tech sector, including Alibaba Group Holding Ltd., Tencent Holdings Ltd. and Didi Global Inc., have been subject to Beijing’s efforts to get companies to do more to serve the Communist Party’s economic, social and national-security goals.

The government’s actions against large tech companies have included disrupting initial public offerings, launching probes and issuing fines.

This story has been published from a wire agency feed without modifications to the text

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