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China’s securities regulator and Ant Group (formerly Ant Financial & Alipay) yesterday clarified that Alibaba’s fintech arm is not resuming its IPO process. Ant IPO was blocked in 2020 as part of a tech crackdown initiated by Beijing, derailing the world’s biggest public listing.
Earlier this week, Bloomberg reported that the China Securities Regulatory Commission (CSRC) had established a team to reassess the fintech giant’s potential public listing. Citing government sources, Bloomberg said that the Ant was in the final leg of receiving a nod from the regulator. Reuters reported that China’s central leadership had given tentative approval for listing Ant Group in Shanghai and Hong Kong.
While this raised hope among investors, the CSRC and the Ant Group were quick to shoot down the reports, and the regulator said it “has not conducted any assessment or research in this regard”. Bloomberg and Reuters have stuck to their reports despite the statement from the CSRC.
Reinvigoration of Ant IPO
“Under the guidance of regulators, we are focused on steadily moving forward with our rectification work and do not have any plan to initiate an IPO,” Ant Group said in a statement.
While the company made its stand public, speculation arose after Laura Cha Shih was appointed as an independent director of the fintech giant last month. Cha was a deputy chairwoman at the CSRC for three years until September 2004 and is the chairwoman of Hong Kong Exchanges and Clearing and a member of the Hong Kong government’s Executive Council.
The company also issued dividends in billions of yuan to its shareholders — the first time since investors were brought on board in 2015.
Alternately, Ant’s recent environmental, social and governance report indicated that the company is moving in the direction of technology development rather than finance. With the tech crackdown cooling down and Ant Group showcasing various changes, speculations arose that the IPO would be resumed.
Most recently, Ant Group launched a digital banking service in Singapore in collaboration with Proxtera, an online marketplace for small businesses. Ant unit ANEXT Bank was granted the digital banking license by the Monetary Authority of Singapore in 2020.
Chinese stocks listed in US markets tumbled after CSRC and Ant Group denied the IPO revival speculations. The Nasdaq Golden Dragon China Index, which tracks major Chinese firms traded in the US, fell 6.8% overnight. Alibaba’s shares dropped as much as 10% on Thursday after the report.
