China’s securities regulator denies reviewing Ant Group’s IPO

China’s securities regulator said it was not currently reviewing or conducting research to revive billionaire Jack Ma’s Ant Group initial public offering, after multiple media outlets quoted unnamed sources as saying the watchdog was considering the question.

The China Securities Regulatory Commission (CSRC) issued the denial on Thursday, the same day Reuters and Bloomberg reported that authorities were considering allowing the Hangzhou-based fintech giant to relaunch its stock sale plans. . In a one-sentence statement posted on its website, the CSRC also said it supports overseas IPOs of platform companies that meet government requirements. Ant Group, for its part, said via its official WeChat account that the company has no plans to launch an IPO and is instead focused on “steadily advancing our rectification work.”

News of the IPO restart and subsequent denials have sparked wild swings in New York-listed shares of Chinese e-commerce giant Alibaba, which owns about a third of Ant. The company’s U.S. Deposit shares were down 8.1% on Thursday, after climbing 7% in premarket trading on hopes its IPO could be revived. In Hong Kong, where Alibaba is also listed, the company’s shares are up 1.7% as of 2 p.m. Friday.

Ant Group, for now, is targeting other parts of Asia for future growth, after Chinese authorities asked it to become a financial holding company and comply with banking regulations. This week it launched a digital bank in Singapore to attract merchants with cross-border operations, just two months after acquiring a majority stake in Singaporean fintech company 2C2P.

For Ant investors, the stakes couldn’t be higher. The company was once valued at more than $300 billion when it was set to raise $35 billion in what was to be the world’s biggest IPO. After the plan was abruptly crushed by Chinese authorities at the end of 2020, its valuation reportedly plunged into a range between $170 billion and $190 billion.

The fintech giant’s once-lucrative microcredit and consumer credit businesses, for example, are coming up against growth caps imposed by authorities seeking to limit risk and reduce leverage in the financial sector. Ant Group has been ordered by regulators to return to its roots as a payments service and “fix” its sprawling lending, insurance and wealth management services.

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Post expires at 6:52am on Wednesday June 22nd, 2022