[blackwasp]

Ant Group is likely to pull off the largest initial public offering in history when it goes public on the Hong Kong and Shanghai exchanges on November 5. The Chinese digital finance giant is hoping to raise $34.4 billion, eclipsing flotations by Saudi Aramco ($29.4 billion) and its cousin Alibaba ($25 billion).

The IPO is likely to value Ant Group at $313 billion. This will make it the fourth-biggest financial company in the world (after Berkshire Hathaway, Visa and Mastercard).

Many are asking what Ant Group is, how it has become so successful, and why it is worth so much. There are also questions about how it relates to the rest of the empire of Alibaba founder Jack Ma.

Unlike many emerging digital giants, Ant Group has been profitable from the get-go. It started life as Alipay, a third-party online payment tool created by Alibaba in 2004.

The catalyst for this move was eBay announcing plans to enter the Chinese market in 2003. Alibaba was China’s star in online retail, but was focused on selling goods for businesses. It now launched Taobao, a cross between eBay and Amazon, to serve consumers.

By 2006, over 300,000 merchants in everything from travel to gaming had adopted Alipay. By 2010, it had connections with over 200 banks in China and started providing payment services for online retailers outside Alibaba Group.

As Alipay grew, regulation became a hot topic. China precluded foreign-owned companies from operating banks, which technically included Alibaba, since Yahoo and Softbank controlled over 50% of the company. Jack Ma and Xie Shihuang, another Alibaba co-founder, purchased back the majority of Alipay stock to create a Chinese-controlled entity that could operate legally.

Source

[libranof1987]

Some hiccups already.

In a late-evening announcement that stunned China, the Shanghai Stock Exchange slammed the brakes on Ant’s initial public offering, which was set to be the biggest stock debut in history with investors on multiple continents and at least $34 billion in proceeds.

The stock exchange’s notice to Ant said that the company’s proposed offering might no longer meet the requirements for listing after Chinese regulators had summoned company executives, including Jack Ma, the co-founder of the e-commerce titan Alibaba and Ant’s controlling shareholder, for a meeting on Monday.

https://www.nytimes.com/2020/11/03/t...-summoned.html

[saket77]

I think the thread title is a little misleading. The group has amassed $3 trillion worth of bids from investors across its dual listing in Hong Kong and Shanghai, which is more than India’s GDP. It looks to looks to raise up to $34.4 billion (about Rs 2.54 lakh crore) in total.

Regards.

[Shreyas_H]

Originally Posted by saket77

I think the thread title is a little misleading. The group has amassed $3 trillion worth of bids from investors across its dual listing in Hong Kong and Shanghai, which is more than India’s GDP.
Regards.

Exactly - the company is not valued higher than India's GDP - the bids received were of over $3 trillion (which is higher than India's GDP) - obviously bids in such a historic IPO were expected to be sky-high. Over-subscription in such a script is obvious.

Anyway, the IPO is on hold and that has caused panic selling of their sister company Alibaba shares - they've lost $60 billion in a day.

[srini1785]

Originally Posted by libranof1987

Some hiccups already.

Big brother CCP does not like anyone getting bigger than them. Alibaba's success is largely due to CCP restricting the likes of FAANG from getting any hold in the Chinese market. No wonder that Ant group is valued close to the combined value of these companies put to gather.

Bhiku Mhatre can't do anything without Bhau's approval

[SmartCat]

Originally Posted by saket77

I think the thread title is a little misleading. .

Originally Posted by Shreyas_H

Exactly - the company is not valued higher than India's GDP - the bids received were of over $3 trillion (which is higher than India's GDP)

Thanks guys! The title of the thread has been changed.

[libranof1987]

Originally Posted by srini1785

Big brother CCP does not like anyone getting bigger than them.

Yep, here's a nice CNN read.

"There's a saying in China: 'The tallest nail gets hammered down,'" said Duncan Clark, author of "Alibaba: The House that Jack Ma Built" and founder of investment advisory firm BDA China. And it would seem Ma just got hammered by the Chinese government, he said.

The Shanghai Stock Exchange's announcement comes just over a week after Ma said avoiding systemic risk is important, but publicly criticized Chinese regulators for stifling innovation by being too risk averse.

"Ant will need to regroup and [retry] the IPO in about six months," Hong said. "In the end, the IPO will go through."

https://edition.cnn.com/2020/11/04/t...hnk/index.html

[AMG Power]

The world's biggest ever IPO has been scuttled. By President Xi personally. Read on to know how politics is played in China and whether they are better at it than the rest of the world.

Note the use of the term "personally", obviously a part of the press release and intended to send a message to anyone who wants to tread that path as to who's in charge:

China's President Xi Jinping personally decided to pull the plug on Ant Group's $37-billion (£28 billion) initial public offering, the Wall Street Journal reported on Thursday, citing Chinese officials with the knowledge of the matter.

The decision to stop what would have been the world's largest ever IPO, came days after the fintech giant's billionaire founder Jack Ma launched a public attack on the country's financial watchdogs and banks.

President Xi ordered Chinese regulators to investigate and effectively shut down Ant's stock market flotation, the report said.

Ma had told a summit in Shanghai on Oct. 24 that the regulatory system was stifling innovation and must be reformed to fuel growth. Earlier this month, Reuters reported the speech set off a chain of events that torpedoed the listing of Ant.

Soon after Ma's scathing speech, state regulators started compiling reports including one on how Ant had used digital financial products like Huabei, a virtual credit card service, to encourage poor and young people to build up debt.

Source