Alibaba Group Holding Ltd. founder Jack Ma has paused his plans to reduce his stake in the e-commerce giant, an internal memo revealed, following a significant drop in the company's share price. Despite earlier intentions to sell 10 million shares, valued at approximately $870 million, Ma has not sold any shares, according to Alibaba's Chief People Officer Jane Jiang.

This decision comes amid a tumultuous period for Alibaba, whose shares have plummeted, prompting Ma to reassess his strategy. In a memo seen by CNBC, Jiang informed employees that Ma's halt in share reduction was linked to the current undervaluation of Alibaba's stock. This revelation follows Alibaba's recent regulatory filings indicating Ma's intention to sell part of his stake, coinciding with the company's quarterly earnings announcement and a decision to scrap plans for a spinoff of its cloud computing business, actions which saw its shares fall around 9%.

Jiang explained that the decision to sell shares, initially made in August, coincidentally became public on November 16, the day of Alibaba's earnings release. At that time, Alibaba's U.S.-listed shares were trading at highs of $101 but have since declined to close at $78.94 on Wednesday. This decline in share value would significantly reduce the proceeds from Ma's intended sale, from $870 million to approximately $789.4 million.

In her memo, Jiang emphasized Ma's confidence in the business, as indicated by his plan to sell down his stake at a higher selling price. Alibaba did not immediately respond to requests for comment on these developments.

Ma, once the face of China's technology sector, has faced challenges from Beijing's sweeping crackdown on the tech industry, which aims to curb the influence of its domestic tech giants. Amid these pressures, Ma has shifted his focus to teaching and research in areas such as agricultural science.

Alibaba itself has undergone significant changes this year, restructuring into six business groups and appointing a new CEO. The company's Chairman, Cai Chongxin, expressed optimism despite these challenges, stating, "As long as we maintain an open mind and innovative thinking, we have the opportunity to create another unique Alibaba."

The pause in Ma's share reduction strategy reflects both the ongoing volatility in the tech sector and the shifting landscape for one of China's most prominent companies. As Alibaba navigates these changes, the actions of its founder and former CEO will continue to draw close scrutiny from investors and the market at large.