Daily Journal Corp has reduced its holding of Alibaba Group Holding Ltd., wiping out shares acquired during the fourth quarter of 2021, Reuters reported. Alibaba has been linked to work with the Chinese government and military but has not been banned from U.S. investments.
The move follows the company’s annual meeting, held in February, where former chairman, Charlie Munger, raised concerns about the growing tension between China and the U.S.
"We wish that China and the United States got along better," he said. "Think about how massively stupid both China and the United States have been to allow the existing tensions to rise. They should like us and we should like them."
The executive has long had a bullish view on investing in China. According to Reuters, he was the main driver behind Berkshire Hathaway's 7% investment in electric car maker BYD Co.
According to recent regulatory filings, Daily Journal Corp owns 300,000 of Alibaba’s depositary shares worth $32.6 million as of March 31, representing a decline from the 602,060 shares reported at the end of 2021, Reuters reports. The price of the Chinese e-commerce giant general ADS has also dropped by 15% this year, and 68% from its peak in October 2020.
Accounts of Alibaba’s association with the Chinese military and governments were supported by a report published by RWR Advisory Group. An example of the collaboration between the two parties includes the development of military cloud computing systems and satellite operations.
Additionally, "In January 2019, executives from Alibaba and Ant Group reportedly met with representatives from the Military-Civilian Fusion Division of the Xi'an Development and Reform Commission and the Xi’an Weapons Science & Technology Industrial Base" and talked about "opportunities for military-civil fusion," according to RWR Advisory Group.
The base serves as a collaboration between Shaanxi Province and China North Industries Group Corp. (Norinco), which the report notes is a Chinese-state owned defense conglomerate.