news/AAPL/2023.01.16/Investor Ryan Cohen builds Alibaba stake, wants more share buybacks.txt

Jan 16 (Reuters) - Billionaire investor Ryan Cohen has
built a stake in China's Alibaba Group worth hundreds
of millions of dollars and is pushing the e-commerce giant to
increase and speed up share buybacks, people familiar with the
matter said on Monday.Cohen, who built his fortune by co-founding online pet
retailer Chewy Inc and cemented it with investments in
videogame retailer GameStop and Apple Inc,
reached out to Alibaba last August to express concerns, the
people said.In his communications, Cohen told Alibaba he thought the
company could reach double-digit sales growth and nearly 20%
free cashflow growth over the coming five years, according to
the sources.Cohen felt Alibaba's shares were undervalued at the time,
according to the people, who declined to be identified because
the investment is private.Alibaba in November raised the size of its share repurchase
program to $40 billion, increasing it by $15 billion, and said
it would extend the time frame for the program through the end
of March 2025.Cohen has told Alibaba executives that more can be done,
suggesting the total buyback program could be raised to $60
billion, the people familiar with his communications said.Alibaba's ADRs, traded in the United States, exchanged
hands at $115.45 on Tuesday, up 28% since early August and up
25% so far this year. The price, however, remains far off its
high of more than $300 a share hit during the COVID-19 pandemic.Most Alibaba investors hold American Depository Shares,
which require them to use a depositary as an intermediary if
they want to cast their votes at shareholder meetings. In its
latest annual report, Alibaba acknowledges that many
shareholders don't cast their vote as a result of the arduous
process involved, and this "can make it more difficult for
shareholders to influence our management."The people familiar with Cohen's thinking said the investor
is eager to have a collaborative, long-term relationship with
Alibaba and that he has praised management's capabilities.Alibaba representatives were not immediately available
for comment.The company's shares began an ongoing tumble in late October
2020, just as authorities in Beijing began a regulatory
crackdown on the tech sector. The company lost about a third of
its value by November 2022, though in recent weeks shares have
recovered amid signs the Chinese government will ease its
pressure on internet companies.Over roughly the same period, Alibaba has steadily escalated
its share buyback program. It first announced the scheme at the
end of 2020, pledging to buy back $10 billion over a two-year
period.The Wall Street Journal first reported Cohen's Alibaba
stake.The Chinese e-commerce company could find a blueprint in
how Apple has helped its own stock price as it repurchased
shares, the people said. Cohen owns a stake in Apple worth
roughly $800 million, they said.As well as cutting the supply of shares available,
supporting their prices, buybacks - often recommended by
activist investors - can send a signal to the market that
executives are confident about how high their companies' shares
might be able to climb.Canada-born Cohen, 37, has a net worth estimated at $2.5
billion. He made a splash in the investing world two years ago
when he joined the board of GameStop, igniting a frenzy in the
stock price that turned the video retailer into a "meme stock"
backed by retail investors.He eventually forced out GameStop management and set out
to revamp it into an e-commerce company.GameStop's shares, which underwent a stock split in 2022,
are up 19% this year, though they are off 25% in the last 52
weeks.Last year Cohen briefly invested in retailer Bed Bath &
Beyond Inc and pushed for the company to consider
selling its BuyBuy Baby chain or possibly the entire company. He
settled with the company and three new directors joined the
board.Much of Cohen's net worth is tied up in a handful of
stocks including Wells Fargo & Co, Citigroup Inc
and Netflix Inc. He also has real estate holdings and
cash.Cohen has said previously that he wants to find more
undervalued companies to invest with and identify those that can
be managed better and push them to adopt changes.(Svea Herbst-Bayliss in New York; Additional reporting by Greg
Roumeliotis in New York, Miyoung Kim in Beijing and Aishwarya
Nair in Bengaluru; Editing by Leslie Adler and Kenneth Maxwell)