Jack Ma’s Ant offers world’s biggest IPO
Hong Kong, Aug. 25: Billionaire Jack Ma’s Ant Group filed for an initial public offering (IPO) in Hong Kong and Shanghai to bankroll its expansion in financial services and bolster its lead as China’s largest online payments platform.
The Hangzhou-based company will issue no less than 10 per cent in new shares of its total capital, according to its filing with the Shanghai exchange. Ant generated 72.5 billion yuan ($10.5 billion) in revenue in the first half, after full-year sales of 120.6 billion yuan in 2019, it said. The firm posted a profit of 21.2 billion yuan in the first half.
The crown jewel of the sprawling Alibaba empire, Ant has been accelerating its evolution into an online mall for everything from loans and travel services to food delivery, in a bid to win back shoppers lost to Tencent Holdings Ltd.
With data from a billion users of its Alipay app at its back, Ant is pushing broadly into financial services, delivering technology such as artificial intelligence, robo investing and lending platforms.
The simultaneous listing could mark one of the biggest debuts in years, and even top Saudi Aramco’s record $29 billion IPO, a person familiar has said. The firm is targeting a valuation of about $225 billion, based on an IPO of about $30 billion if markets are favourable, people familiar with the matter have said.
The company will use the proceeds to expand cross-border payments and enhance its research and development capabilities, according to the filing, which didn’t provide a share price range or the amount it intends to raise in the IPO.
Unlike Chinese tech giants such as Alibaba Group Holding Ltd., Ant decided against listing in the US at a time of increased scrutiny by the Trump administration of Chinese companies and warnings to US endowment funds to offload their stakes in US-listed Chinese businesses.
Ant’s Shanghai listing marks a victory for the city’s exchange, and is part of an effort by China to establish its own capital markets as tensions with the United States escalate.
Alibaba is Ant’s largest shareholder, with a 33 per cent stake. Hangzhou Junao, an entity that is owned by key Ant and Alibaba executives, owns 20.66 per cent, while Hangzhou Junhan, which holds shares on behalf of Ant employees, owns a 29.86 per cent stake.