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HONG KONG (REUTERS) – Ant Group’s $ 37 billion (Singapore $ 50.3 billion) listing has been suspended in both Shanghai and Hong Kong in a dramatic move just two days ahead of what was supposed to debut. largest stock exchange in the world.
The Shanghai Stock Exchange first announced that it had suspended Ant’s initial public offering (IPO) on its Star market, prompting Ant to also freeze the Hong Kong leg of the double listing.
Ant said its listing had been suspended by Shanghai following a recent interview that regulators held with founder Jack Ma and top executives. He said that it may not meet listing ratings or disclosure requirements, and also cited recent changes in fintech’s regulatory environment.
Shanghai described Ant’s meeting with Chinese financial regulators as a “major event.”
Ant was to go public in Hong Kong and Shanghai on Thursday after raising about $ 37 billion, including the domestic tranche greenhoe option, in a record public sale of shares. “This is a curve ball that has been thrown at us … I don’t know what to say,” said a banker who works at the IPO.
Regulators had summoned Ma, Ant CEO Eric Jing and CEO Simon Hu to a meeting on Monday when they were told that the company’s lucrative online loan business faced stricter government scrutiny, they said. sources to Reuters. The meeting came when the Chinese authorities published a new draft of rules for online microloans.
In late October, Ma had called financial regulation outdated and unsuitable for companies trying to use technology to drive financial innovation. But Beijing has become more uncomfortable with banks largely using microlenders or third-party tech platforms like Ant to underwrite consumer loans, amid fears of rising defaults and deteriorating asset quality in a economy hit by a pandemic.
Shares of Ant’s subsidiary, Alibaba Group, fell about 8.6 percent in pre-market trading after news of the Shanghai Stock Exchange’s suspension of Ant’s A-share IPO.
The group said Tuesday that it sincerely apologizes to investors for any inconvenience caused by the suspension of IPOs in Hong Kong and Shanghai.
He added that he will await further notice from regulators regarding further developments in the bidding and listing process.
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