he will surrender Jack Ma The founder of Ant Group has taken control of the Chinese fintech giant in a review that seeks to draw a line under a regulatory crackdown launched shortly after disrupting its massive IPO two years ago.
And Ant’s $37 billion IPO, which would have been the world’s largest, was canceled at the last minute in November 2020, prompting a forced restructuring of the fintech firm and speculation that the Chinese billionaire would relinquish control. .
And while some analysts said the relinquishment of control could pave the way for the company to revive its initial public offering, the changes announced by the group on Saturday are likely to lead to further delays due to listing regulations, as China’s stock market demands companies to wait three years after a listing change, with a two-year wait in Shanghai’s STAR Market similar to the Nasdaq, and one year in Hong Kong.
The former English teacher previously held more than 50% of the voting rights in Ant, but according to Reuters calculations his stake will drop to 6.2%. But he only holds 10% of Ant, a subsidiary of the Alibaba group. E-commerce giant Group Holding Ltd but exercised control of the company through related entities, according to Ant’s IPO prospectus filed with exchanges in 2020.
The prospectus showed that Hangzhou Yunbo, an investment vehicle of Ma’s, controls two other entities holding a combined 50.5% stake in regulators Ant., as Chinese authorities prepare to fine the company more than $1 billion. dollars, Reuters reported in November.
The expected retribution is part of Beijing’s vast and unprecedented campaign against the country’s tech giants over the past two years, which has slashed hundreds of billions of dollars in valuations and slashed revenues and profits.
But in recent months, Chinese authorities have softened the tone on tough tech-related measures amid efforts to boost the $17 trillion economy that has been hit hard by the COVID-19 pandemic. Feverishly, the government is trying to signal its commitment to growth, and technology and the private sector are key to that, as we know.”
Regulatory audit
Ant operates China’s Alipay mobile payment app, the largest in the world with over 1 billion users. Ant, whose business also includes consumer loans and distribution of insurance products, said Ma and 9 other major shareholders have agreed not to trade. exercising their voting rights, they would only vote independently.
He added that the business interests of Ant’s shareholders will not change as a result of the changes and that Ant will add a fifth independent director to its board so that independent directors make up the majority of the company’s board members It currently has eight members of the board of directors.
“Accordingly, there will be no situation in which a direct or indirect shareholder has sole or joint control of Ant Group,” it said in its statement. Reuters reported in April 2021 that Ant was exploring options for Ma, one of its most successful and influential businesspeople in China, to give up her stake in Ant and relinquish control.
The Wall Street Journal reported in July last year, citing unnamed sources, that Ma could relinquish control by transferring some of his voting powers to Ant officials, including CEO Eric Ging.
