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China Takes Stakes in Private Data Companies

The ‘golden share’ practice was previously confined to companies specialising in online news and content

Chinese truck-hailing apps Huochebang and Yunmanman, owned by Full Truck Alliance, are seen on mobile phones. Image: Reuters.


The Chinese government has been expanding its practice of taking minority stakes in private companies to those possessing large amounts of key data, two people with knowledge of the matter said.

It has made a de facto special management stake or “golden share” arrangement with Full Truck Alliance, a Chinese platform arranging trucking services, according to one of the people.

Didi Global has also been in talks about a golden share for its core ride-hailing business, a third person with direct knowledge of the matter said.

The practice was previously confined to companies specialising in online news and content. About five years ago, Beijing began taking golden shares in private online media companies – usually about 1%.

The stakes are bought by government-backed funds or companies which gain a board seat and/or veto rights for key business decisions.


Critical Importance

In April, a think tank operating under China’s markets watchdog released a working paper in encouraging golden shares in groups of critical importance to the public.

Wu Xiaoling, a former head of the Chinese central bank’s policy research office, called in June for the implementation of the golden share system for systemically important data companies.

Authorities are now also keen to have some control over vast troves of data owned by certain companies, the sources said, adding that the data is seen as a national asset at risk of attack and misuse, including by foreign states.

“They have broadened their attention to other companies that possess strategically important data and are considered operators of critical information infrastructure,” said one person with direct knowledge of how some state investors handle such stakes.

Often there is no evidence of a golden share until the share ownership is publicly registered but that can take a year or longer, but authorities are now more willing to highlight their ownership.

Reuters was not able to ascertain how many other data-rich firms in which authorities were seeking to take a golden share.


  • Reuters with additional editing by George Russell




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George Russell

George Russell is a freelance writer and editor based in Hong Kong who has lived in Asia since 1996. His work has been published in the Financial Times, The Wall Street Journal, Bloomberg, New York Post, Variety, Forbes and the South China Morning Post.


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