BY Richard Summerfield
The $37bn initial public offering (IPO) of Ant Group was suspended at the eleventh hour on Tuesday in a move which dealt a significant blow to the financial technology firm founded by billionaire Jack Ma.
The company’s listings in Shanghai and Hong Kong were suspended by Chinese authorities citing ‘major issues’ with the filings. The Shanghai Stock Exchange said in a statement that Mr Ma had been called in for “supervisory interviews”, and that a change to the regulatory environment meant Ant no longer met “listing conditions or information disclosure requirements”.
The Hong Kong exchange then reported that Ant had decided to suspend its planned listing. Ant was due to sell about 11 percent of its shares across the two stock exchanges.
That the IPO was called off so late in the process is remarkable given the potential size of the filing. Ant would have recorded a possible market valuation of more than $300bn at its IPO price, placing it among the most valuable companies in the world.
Ant was spun out of Alibaba in 2011, seven years after its parent company was founded. Alibaba acquired 33 percent of Ant’s value in 2018 ahead of its planned IPO. At the time, Ant was valued at around $60bn.
Since the company was spun out, it has enjoyed a meteoric rise. Ant runs Alipay, the leading online payment system in China, which has eclipsed cash, cheques and credit cards. Alipay has over 1 billion annual active users and over 80 million active merchants on the platform.
Alibaba, which had previously broken the record for biggest stock market debut in 2014, saw its share price fall 9.6 percent in Hong Kong trading on Wednesday, following an 8.1 percent fall in New York on Tuesday after the suspension was announced.
News: China slams the brakes on Ant Group’s $37 billion listing