(Bloomberg) — Meituan founder Wang Xing has donated a $2.3 billion stake in the Chinese food delivery giant to his own philanthropic foundation, joining other internet billionaires in giving back as Beijing mounts a crackdown on the tech sector.
Meituan’s chairman and chief executive officer transferred 57.3 million shares to the organization, the company said in a filing late Thursday. That’s about a 10th of the billionaire’s stake in the company, worth HK$17.6 billion ($2.27 billion) based on its last close. The stock slid more than 3% in early Friday trade.
Meituan is grappling with an investigation by China’s antitrust watchdog, part of a broader campaign to curb the growing influence of internet giants like Alibaba Group Holding Ltd. and Tencent Holdings Ltd. In April, Tencent founder Pony Ma pledged $7.7 billion toward curing societal ills and lifting China’s countryside out of poverty, echoing Xi Jinping’s priorities at a time Beijing is tightening its grip on the sector.
Wang’s largesse will go toward education and science, similarly echoing nationwide priorities in speeding technological innovation. The surprise move coincides with speculation over the billionaire’s fate after Wang posted online a classical poem about book-burning during the Qin dynasty that some interpreted as a veiled criticism of Beijing. The entrepreneur deleted it days later and issued a clarification that he used the poem in reference to the company’s competitors.
Read more: A 1,100-Year-Old Poem Cost Meituan’s Outspoken CEO Billions
“The changes regarding Wang Xing’s interest in shares of Meituan represent a personal asset allocation decision that was made out of philanthropic considerations,” the company said in a statement. “This decision does not reflect any changes in his dedication to Meituan’s business.”
Meituan is awaiting the outcome of an investigation that kicked off in April over alleged antitrust violations. Financial regulators then imposed wide-ranging restrictions on its fintech operations, alongside those of peers like Didi. At the same time, renewed scrutiny over the treatment of its delivery riders added to concerns regulators may intervene to demand business changes, eroding profitability.
Still, some investors are betting that the crackdown on homegrown tech giants may be winding down, leaving stock valuations of some of the major firms at attractive levels. While a probe into billionaire Jack Ma’s empire, spanning Alibaba and Ant Group Co., took three to four months, a second batch of investigations into firms such as Tencent and Meituan may proceed more quickly. That suggests the regulatory cycle could be wrapping up as key players in the industry have agreed on what needs to be done, according to Hyomi Jie at Fidelity International Ltd., whose China consumer equity funds oversee $7.3 billion in assets.
Read more: China Tech Crackdown Cycle Nearing an End, Top Fund Manager Says
Wang last week unveiled better-than-expected results and moved to reassure investors, igniting a rally in the company’s stock. He detailed plans to address government concerns about its business practices, pledged to work with regulators and improve its compliance standards.
The company also promised to provide insurance for millions of its delivery drivers — many of them work as part-time personnel and lack proper employee benefits — and has started to reform its commissions scheme in a move to cut fees for partner restaurants.
Meituan said in its Thursday filing that 9.35 million shares of the transferred stake had already been gifted to an unspecified third party.
Read more: Meituan Surges as CEO Moves to Address Antitrust Concern
(Updates with share action from the second paragraph)
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