Chinese regulator approves Hong Kong leg of Ant’s $30bn IPO
Ant Group has received approval from Chinese regulators for the Hong Kong leg of its $30 billion initial public offering (IPO).
Three people with direct knowledge of the matter, tell The Financial Times (FT) that Ant was given clearance by the China Securities Regulatory Commission (CSRC) on 19 October.
This will enable it to proceed with the Hong Kong leg of the IPO.
The Chinese payments group controlled by billionaire Jack Ma, is planning a dual listing in Shanghai and Hong Kong.
The company still needs approval from the Hong Kong stock exchange’s listing committee. Two of those people tell the FT that the committee could hear Ant’s application between 19-20 October.
The CSRC and Ant did not immediately respond to requests for comment from the FT on the status of the company’s IPO. Hong Kong Exchanges and Clearing, the city’s bourse operator, declined to comment.
Shares in Ant, which some analysts are valuing at as much as $318 billion, could price ahead of the US presidential election on 3 November, according to one of the sources.
The size of the Chinese group’s IPO is expected to exceed that of Saudi Aramco’s in 2019, which raised more than $25 billion.
The FT notes that bankers working with the company are eager for the IPO to not clash with the vote, which they view as a potential source of market uncertainty. “During the election you have a lot of volatility,” says one banker.
The Shanghai Stock Exchange approved the listing of Ant shares on its technology-focused Star market last month.
Investors are eager to secure shares in Ant, which has 711 million monthly users.
It has rapidly growing profits and funnelled about one-tenth of all credit to Chinese consumers in the past year — more than any bank.
The approval from Chinese regulators could help reassure some concerns. These come after Ant faced scrutiny over its decision to offer retail traders access to its share sale through an exclusive arrangement on its Alipay mobile payments app.
In addition to the normal retail tranche set to be offered to investors in Shanghai as part of the IPO, Ant allowed five domestic fund managers to buy up shares that they then offered to retail traders as “strategic allocation funds”.
Alipay promoted the funds heavily ahead of China’s recent national holiday.
Reuters reported last week that regulators in China had delayed the approval of the listing in Hong Kong. The delay concerns its checks regarding Alipay’s arrangement with the funds.
Read more: Alibaba’s Ant plans Hong Kong IPO