Chinese fintech giant Ant Group said on Sunday, Jan. 7, that it has no plans for an initial public offering (IPO), after all the hype it has received in recent months.
Speaking to Reuters, the company’s spokesperson said:
“Ant Group is focused on rectifying and optimizing its business, and has no plans to go public.”
With Chinese regulators rampant in the local tech landscape, Ant Group has also been facing the heat.
Ant Group is nearing the end of its two-year regulatory restructuring. That’s because Chinese authorities were trying to fine the financial company more than $1 billion.
Jack Ma gives up control of Ant Group
The latest IPO rejection announcement comes just one day after founder Jack Ma ceded control once again. As per the announcement made last weekend, Ant Group will change its voting structure.
The change involves giving voting rights to a total of 10 people, including the founder, employees and management. Jack Ma’s handover of control of his Ant Group comes as he retreats from his empire in the wake of China’s crackdown on the local tech industry.
Adjustments related to Jack Ma’s departure will not impact individual shareholders. Jack Ma has been out of the public eye since he gave a speech criticizing regulators after Ant’s failed IPO in 2020. Since then, Ant has focused on revising its business operations and appeasing regulators. Ant Group has also strengthened its capital base for its consumer lending subsidiary. In addition, it has built firewalls to serve wealth management and consumer lending.
Change of control further pushes back IPO plans
China’s A-share market requires companies to wait three years after a change of controller to list on the Shanghai STAR market. However, for the Hong Kong market, the waiting period is one year.
Jack Ma still holds the economic interest and voting rights in the company after the change. Last year, in July 2022, Alibaba Group Holding Ltd, a subsidiary of Ant, said that Jack Ma “intends to reduce and subsequently limit his direct and indirect economic interests in Ant Group over time“to a percentage not exceeding 8.8%.