Chinese Regulators Green Light Ant's Hong Kong IPO

Marco Green
October 19, 2020

Ant Group is getting closer to launching what is shaping up to be the world's largest initial public offering after winning approval from China's securities regulator for its plans.

Ant plans to start a brief pre-marketing period this week before opening order books next week, one of the sources said. It also will mark a win for the Hong Kong stock exchange that lost many of Chinas tech stars to USA listings. A hearing or consultation with the Hong Kong stock exchange, an important part of the regulatory clearance process, is scheduled to take place on Octobre 19, 2020, CNBC reported. Its shares are likely to start trading "a few days" after the November 3 US presidential election, said the person.

Ant aims to sell 10% to 15% of its enlarged share capital during the IPO, split equally between Hong Kong and Shanghai. "Even as the company waited for the nod, an huge amount of work has happened".

Ant plans to start a brief pre-marketing period this week before opening order books next week, IFR reported, saying Ant's shares are likely to start trading "a few days" after the November 3 United States presidential election.

Ant Group could not be immediately contacted for comment.

Ant won't seek cornerstone investors for Hong Kong, but will invite big backers for its Shanghai sale to mitigate price fluctuations, people familiar have said.

Last week, sources said the China Securities Regulatory Commission was investigating a potential conflict of interest in the planned listing, delaying approval.

In the mainland, five mutual funds raised Dollars 9 billion from more than 10 million retail investors, with 10% of the funds earmarked for the IPO, via Ant's Alipay platform. The valuation of US$280 billion will be higher than that of Bank of America and three times that of Citigroup.

Ant, which began as a payment unit of Alibaba, is now a virtual finance mall.

Ant's parallel listings on the Hong Kong and Shanghai stock exchanges would mark the biggest float on record, beating Saudi Aramco's record-shattering $25.6 billion IPO. However, a very significant part of its revenue comes from selling Fintech-focused products and generating profits from technology service fees.

Other reports by Click Lancashire

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