Ant Group debut postponed

HONG KONG – The planned stock market debut of the world’s biggest online finance company, Ant Group, was suspended in Shanghai and Hong Kong on Tuesday, disrupting a record-setting $34.5 billion initial public offering that highlighted China’s recovery from the coronavirus pandemic.

The Shanghai stock exchange cited regulatory changes in Ant’s industry and a possible failure to meet disclosure requirements but gave no details. Ant said later it would suspend its Hong Kong debut due to the Shanghai suspension. Shares were to have started trading on both exchanges Thursday.

The suspension followed a Monday meeting between regulators and Ant executives including founder Jack Ma, China’s richest entrepreneur. Ma also founded Alibaba Group, the world’s biggest e-commerce company by sales volume, which spun off its Alipay payments service to create the company that became Ant Group.

“Views regarding the health and stability of the financial sector were exchanged,” Ant Group said in a prepared statement. The company said it was “committed to implementing the meeting opinions” but gave no details.

“We will continue to improve our capabilities to provide inclusive services and promote economic development to improve the lives of ordinary citizens,” the company said.

Ant apologized to investors and said it would wait for notice from regulators about further developments.

Ant operates Alipay, the world’s biggest financial technology company and, along with Tencent’s WeChat Pay, one of two dominant electronic payment systems in China.

In a joint statement, the Chinese central bank, securities regulator and other agencies said Monday they had “regulatory interviews” with Ma, Ant Group chairman Eric Jing and president Hu Xiaoming.

Ant Group’s shares were due to begin trade in Hong Kong and Shanghai on Thursday after it raised at least $34.5 billion. Retail investors in Shanghai placed bids for nearly $3 trillion worth of shares.

The company has come under increased scrutiny and tighter regulation as it expanded the range of financial technology services it offers. Among the new regulations are caps on the use of asset-backed securities to fund consumer loans, new capital and licensing requirements and caps on lending rates.

On Monday, the central bank raised the minimum required capital for lenders such as Ant to a 5 billion yuan ($750 million).