XPeng Shares Fall in Hong Kong as Alibaba Continues to Trim Stake

By Kimberley Kao

XPeng's stock fell sharply in Hong Kong as Alibaba sold more shares in the electric-vehicle maker, potentially divesting itself of noncore assets.

Shares of XPeng fell as much as 8.0% early Thursday and were recently 5.7% lower at 38.25 Hong Kong dollars (US$4.89). Alibaba's stock was last 2.2% higher at HK$72.80.

Both companies are listed on the New York Stock Exchange. XPeng's American depositary receipts closed 3.8% lower, while Alibaba's rose 1.0%.

In a Securities and Exchange Commission filing Wednesday, XPeng said Taobao China Holding, an Alibaba subsidiary, sold 33 million ADRs valued at US$314.0 million.

This is the third time in four months that China's largest e-commerce company has pared its stake in XPeng, whose ADRs it bought ahead of the EV company's U.S. initial public offering in 2020.

Earlier this week, XPeng said it terminated a 2021 agreement with Taobao China to appoint an Alibaba nominee as a director. It said it would continue collaborating with Alibaba in areas such as research and development and marketing services.

Kelvin Lau, an analyst at Daiwa Capital Markets, said the sale looks like a "general strategy" for Alibaba to divest itself of these noncore investments. He said that if Alibaba was planning to exit and not be a strategic investor, there would be no need for XPeng to offer a board seat.

Write to Kimberley Kao at kimberley.kao@wsj.com

(END) Dow Jones Newswires

March 21, 2024 03:09 ET (07:09 GMT)

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