Alibaba co-founder Jack Ma’s rumored arrest — which later turned out to be false — sent shares of the company falling by as much as 10% within minutes on Tuesday morning and cost the firm $26 billion in value.
On Tuesday, China state-run media reported that a man with the same name as Ma’s — which is a very common name in China — was arrested by authorities for alleged national security violations.
The arrest took place in the Chinese city of Hangzhou, which is where the e-commerce company is based.
News of the arrest of “Ma” rattled the markets as investors started selling off Alibaba stock. The company’s share price dipped 9.4% in early trading in Hong Kong on Tuesday, according to Bloomberg News.
But state-run media issued a clarification, noting that the person in question was not the Alibaba co-founder.
The arrested individual, who was identified as an employee of a local IT company, was born in 1985 — which makes him at least 20 years younger than Ma.
After the clarification, Alibaba’s shares recovered most of their losses.
Ma has been largely absent from the public stage since November of 2020, when he was hauled in for questioning by regulators for criticizing China’s state-owned banks.
A scheduled IPO of his other company, Ant Group, was shelved as a result.
The government moved against tech unicorns like Alibaba, Tencent, Meituan, and Didi.
Last year, Alibaba was fined a record $2.75 billion in April over monopoly violations.
Ma, the former English teacher, disappeared from public view for three months before surfacing in January 2021, speaking to a group of teachers by video. That eased concern about his unusual absence from the limelight and sent Alibaba shares surging.