Ant Group IPO set for further delay as Jack Ma plans to give up control

Jack Ma plans to relinquish control of Ant Group, a change that would delay the Chinese fintech giant’s plans to launch an initial public offering.

The downturn comes after Beijing derailed Ant’s groundbreaking initial public offering nearly two years ago, and demanded the group restructure its operations.

That moment also led the billionaire businessman to retreat from public view, as Beijing moved to curb the influence of corporate giants and launched a broader crackdown on technology.

The “correction” operation overseen by China’s central bank has forced Ant to revamp its business by selling stakes in high-performing units such as lending and credit scoring to other groups, including state-owned enterprises, as well as downsizing some of its operations. Like the monopoly money market fund that was once the largest in the world.

Ma has been considering giving up control for several years, and Ant brought up the change in talks with regulators early last year, according to people familiar with the matter.

But giving up control of Ma would require Ant to delay the resumption of an initial public offering for at least one year and possibly three years, depending on where the group ultimately chooses to sell the shares. Companies need to wait up to three years for listing on the mainland if changes are made to the controlling shareholder, while Hong Kong requires a one-year layover.

The Wall Street Journal, which first reported the plan, said Ant notified regulators of the pending change as part of its application to convert to a financial holding company, which was filed earlier this year.

The People’s Bank of China has not yet approved the request, and reports last month that Ant was about to finish its “correction” were met with fierce denial by unnamed officials who spoke to Chinese state media.

The suspension of Ant’s IPO in November 2020 triggered a massive regulatory crackdown on Chinese tech groups, including billions in fines to Ant’s sister company Alibaba for monopolistic practices and a demand that Didi Passenger Services Group abandon its US listing.

Ma, China’s most famous and dynamic businessman, was also forced to retreat into the shadows while Beijing targeted his empire and channels of influence. His prized business college in Ali Baba’s home city of Hangzhou was barred from enrolling new students, and the city’s Communist Party secretary was fired on corruption charges, a scandal in which you, too.

Some move to relinquish control could be made through changes to the voting agreement made in the run-up to Ant’s planned show in Shanghai and Hong Kong. At the time, Ma handed over shares in the group’s controlling shareholder Hangzhou Yunbo to senior associates including then-CEO Simon Ho, President Eric Jing, and Jiang Fang, a co-founder of Alibaba and an Ant director.

The changes left Ma owning 34 percent of the shares in Yonpo and each of his associates holding a 22 percent stake, but the parties also entered into an agreement that gave Ma control of the voting in Yonpo.

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