- Ant seeks to file a preliminary prospectus immediately after July-sources
- Ant needs CSRC guidance on the timing of the submission of the source prospectus
- Ant says he has no plans to restart his IPO
- Warburg Pincus estimated Ant at $ 180 billion at source in late March
HONG KONG, June 9 (Reuters) – China’s central leadership has given the preliminary green light to billionaire Jack Ma’s Ant Group to resume its initial public offering (IPO), two sources familiar with the matter said, a clear indication that Beijing is weakening. his repression of the technology sector.
Ant, a subsidiary of Chinese e-commerce giant Alibaba Group Holding Ltd (9988.HK), aims to file a preliminary prospectus for shares in Shanghai and Hong Kong as early as next month, sources said, declining to be named. to the sensitivity of matter.
The Fintech giant will have to wait for guidance from the China Securities and Exchange Commission (CSRC) on the timing of the prospectus, one source said.
Register now for FREE unlimited access to Reuters.com
I’m registering
In a public statement, Ant said there was no plan to restart the IPO without giving details. She did not respond to a Reuters request for comment on whether she had received the green light from Beijing.
The company’s stock market listing was hastily postponed by order of Beijing in November 2020. At the time, it was valued at about $ 315 billion and was planned to raise $ 37 billion, a world record.
“Under the leadership of regulators, we are focused on constantly moving forward with our adjustment work and have no plan to launch an IPO,” Ant said in his WeChat account late Thursday.
Neither the CSRC nor the Information Office of the State Council of China, which handles media inquiries about central leaders, responded to Reuters’ request for comment.
Ant wants to keep plans to resume the IPO low pending an official announcement after gaining regulatory brilliance in its first attempt in 2020 with the waves that created supply as the world’s largest in share history, a separate source with direct knowledge of the issue I said.
Chinese authorities have suspended an IPO and crashed against Ma’s business empire after he delivered a speech in Shanghai in October 2020, accusing financial supervisors of stifling innovation.
The derailment of the IPO marks the beginning of regulatory repression to control China’s vast domestic technology sector, which has spread to other industries, including property and private education, wiping billions from market capitalization and causing layoffs in some companies.
As its economy slows in a politically sensitive year when Xi Jinping is expected to secure an unprecedented third term as party leader, Beijing is seeking to loosen its grip on private business, including technology giants, to help it achieve its growth goal. of 5.5%, something economists said would be difficult to access given the blockade of COVID-19. Read more
“They are withdrawing from their repression to make up for the blockade they have had. All the data from China lately is terrible because of the blockade, and the last thing they want to do is complicate the problem. In the next three to six months, we are likely to end China’s repression, “said David Madden, a market analyst at Equiti Capital in London.
The resurgence of the IPO may also mark a kind of rehabilitation for Ma, who has maintained a low public profile since Beijing invaded.
EFFORTS EFFORT
Chinese Deputy Prime Minister Liu He told technology executives last month that the government supports the development of the sector and will support companies seeking listings at home and abroad. Read more
In another sign of Beijing’s softer stance, Chinese company Didi Global, which has been under investigation for cybersecurity since last year, is in advanced talks to buy a third of the state-backed electric vehicle maker, Reuters reported on Wednesday.
The news of the talks comes after the Wall Street Journal reported on Monday that Chinese regulators are ready to complete their investigation into Didi, which may offer more hope to investors for his recovery. Read more
Bloomberg reported earlier Thursday that Chinese financial regulators have begun talks at an early stage to potentially revive Ant’s debut in the stock market, without mentioning a timetable. Read more
The top securities regulator has set up a team to re-evaluate plans to sell shares, Bloomberg reported.
The regulator later said in a statement that it had not carried out any evaluation or research work on Ant’s IPO.
Shares of Alibaba, which owns nearly a third of Ant, fell 7 percent in the United States after rising 7 percent in pre-market trading, according to a Bloomberg report.
U.S. private equity firm Warburg Pincus, a major investor in Ant’s private fundraising in 2018, lowered its Ant estimate to about $ 180 billion at the end of March from $ 221 billion a year earlier, a separate source said.
Regulators have urged Ant to restructure as a financial rather than a technology company, and sources and analysts say the financial sector tends to have lower ratings.
Warburg Pincus declined to comment Thursday.
“The size of the Ant and IPO will have to be smaller than planned in 2020 because market conditions have changed and cannot be compared to now,” said Dickie Wong, executive director of Kingston Securities in Hong Kong.
Shares of Chinese technology and e-commerce companies, including Didi and Alibaba, were quoted in the United States this week amid hints that Beijing’s year-and-a-half crackdown could be eased.
Register now for FREE unlimited access to Reuters.com
I’m registering
Report by Julie Ju; Additional reports by Medha Singh, Abinaya Vijayaraghavan, Scott Murdoch, Kane Wu and Vidya Ranganathan; Edited by Sumeet Chatterjee, Carmel Crimmins, Elaine Hardcastle and David Evans
Our standards: Thomson Reuters’ principles of trust.
Add Comment