Since November, the PRC government has been trying to discuss with the leadership of Ant Group the transformation of one of the parts of Jack Ma’s empire into a holding company, subject to the rules common to financial organizations. Regulators, according to the new data, are already close to agreeing on the plan, the details of which will become known next week.
According to Bloomberg, citing its own informed sources, the plan should be made public before the start of the New Year holidays in China. It will cover various areas of Ant Group’s activities, not just financial, as previously thought. For example, blockchain technology and a food delivery business will also be part of the restructured holding.
The February changes will be the first step on a long road, the ultimate goal of which will be to transform Ant Group into a multifunctional holding, subject to new rules formulated by the Chinese authorities. The latter have long been concerned that the financial technology sector in the country is developing outside the usual regulatory field, and the high rates of expansion may pose certain risks for end users. Ant itself, increased government regulation could bring a slowdown in business development.
The source reports that Ant Group has not lost hope of going public, which was disrupted in November at the initiative of the Chinese authorities. The timing of preparing a new attempt will depend on how long it will take to coordinate this event, taking into account the new structure of the holding. All of this news pushed the parent company Alibaba Group’s stock price up 0.4%, but prices are still below their October record by about 15%.
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