The planned stock market debut of the world’s biggest online finance company, Ant Group (螞蟻集團) was suspended in Shanghai and Hong Kong yesterday, disrupting a record-setting US$34.5 billion initial public offering (IPO) that highlighted China’s recovery from the COVID-19 pandemic.
Management of the Shanghai stock exchange cited regulatory changes in Ant’s industry and a possible failure to meet disclosure requirements, but it offered no details.
Ant Group later said in a filing with the Hong Kong stock exchange that it would also suspend its listing there following its suspension in Shanghai.
The suspension comes one day after meeting between regulators and company executives, including Ant founder Jack Ma (馬雲), China’s richest entrepreneur.
Ant Group issued a statement late last night “sincerely apologizing” to investors for any inconvenience caused by the suspensions of the IPOs.
It said it would handle follow-up matters in accordance with the Hong Kong and Shanghai exchanges’ regulations and keep in close communication with the Shanghai exchange and relevant regulators.
US shares of Alibaba Group Holding Ltd (阿里巴巴), which was spun off Ant Group, tumbled more than 9.6% percent early yesterday, matching the company’s largest percentage decline since its first day of trading on the New York Stock Exchange.
In a joint statement, the People’s Bank of China, the China Banking and Insurance Regulatory Commission, the Securities Regulatory Commission and the State Administration of Foreign Exchange said they had conducted “regulatory interviews” with Ma, Ant Group chairman Eric Jing (井賢棟) and its president, Simon Hu (胡曉明).
Neither side disclosed details of the meeting.
“Views regarding the health and stability of the financial sector were exchanged,” Ant Group said in a prepared statement.
The company said it was “committed to implementing the meeting opinions,” but gave no details of what instructions the executives received.
“We will continue to improve our capabilities to provide inclusive services and promote economic development to improve the lives of ordinary citizens,” the company said.
The market debut of Ant, spun off from Alibaba Group, highlighted the rebound of China, the first major economy to return to growth after the COVID-19 pandemic began last December.
Ant Group operates Alipay (支付寶), the world’s biggest financial technology company and one of two dominant Chinese digital wallets in China, the other being rival Tencent Holdings Ltd’s (騰訊) WeChat Pay (微信支付).
The decision to go public simultaneously on exchanges in Shanghai and Hong Kong reflected the evolving nature of China’s fast-growing financial markets and their relationship to the country’s fledgling corporate giants such as Ant and Alibaba.
Ant Group’s shares were due to begin trade in Hong Kong and Shanghai tomorrow after it raised at least US$34.5 billion. Retail investors in Shanghai placed bids for nearly US$3 trillion worth of shares.
Additional reporting by Reuters
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