Cai Chongxin will sell 6.5 million Alibaba shares to cash in about US$600 million before October

This program is designed to meet charitable commitments and general financial purposes. 6.5 million shares account for about 8% of Cai Chongxin's actual ownership of Alibaba shares.

Original title: Cai Chongxin will sell 6.5 million shares of Alibaba before October this year

Alibaba's recent 6-K filing with the U.S. Securities and Exchange Commission (SEC) shows that the Joe and Clara Tsai Foundation, the charitable fund of Cai Chongxin's Vice Chairman of Alibaba's Board of Directors, and the other two entities belonging to Cai Chongxin, Parufam Limited and MFG II Ltd., have adopted pre-arranged stock sales plans. The plan allows the entities to sell approximately 6.5 million shares in Alibaba by October 2017.

This program is designed to meet charitable commitments and general financial purposes. 6.5 million shares account for about 8% of Cai Chongxin's actual ownership of Alibaba shares.

As of the most recent trading day (December 30), Alibaba's share price was US$87.81. Based on this calculation, the book gain from selling this part of the shares may reach US$570 million (approximately RMB 3.96 billion).

According to the trading plan, stock sales will be based on price and trading volume limits, conducted from time to time, and executed by third-party securities firms.

In August 2016, Alibaba Group also submitted a plan to the SEC allowing Jack Ma to sell up to 9.9 million shares of Alibaba Group shares in the 12-month period beginning in September 2016.

According to SEC Rule 10b5 -1, company executives and directors can use written, pre-arranged stock trading plans to meet commitment and financial requirements, extend the stock trading period, reduce the impact on the market, and avoid concerns about inside information.

Editor: Nancy