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BENGALURÚ / BEIJING (Feb 3): Ant Group Co agreed on a restructuring plan with Chinese regulators under which the fintech giant will become a financial holding company, Bloomberg News reported.
The plan calls for putting all of Ant’s businesses in the holding company, including its technology offerings in areas such as blockchain and food delivery, according to a report on the Bloomberg website.
He cited people familiar with the matter as saying that an official announcement could come before the start of China’s Lunar New Year holiday, which begins on February 11.
Ant declined to comment. China’s central bank did not immediately respond to a faxed request for comment.
The company, a subsidiary of e-commerce giant Alibaba Group, will debut on the market in November. However, an October speech by its founder Jack Ma in which he criticized China’s regulatory system kicked off a series of events that ultimately led to the suspension of Ant’s $ 37 billion initial public offering (IPO).
Since then, Chinese regulators have warned Ant and the broader tech industry that they intend to impose stricter regulations, reversing a once laissez faire approach they took toward the internet financial sector and platforms. Ant’s businesses include payment processing, consumer loans, and distribution of insurance products.
Bloomberg also said that Ant was still exploring possibilities to revive its IPO, citing a person familiar with the matter. However, he said it was unclear how long the authorities would need to sign a listing given that the financial holding company framework was so new.
Hong Kong-listed shares of Alibaba closed 0.4% higher on Wednesday. They fell early in the session after the company reported its third quarter results and warned it faced a short-term challenge due to regulatory change.
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