Ant Group clears final regulatory hurdle for launch of blockbuster IPO

Last modified October 21, 2020. Published October 21, 2020.
The app for Alipay, the mobile payments service operated by Ant Group, is seen on a smartphone in Beijing on Monday, July 20, 2020. Ant Group, the online payments arm of e-commerce giant Alibaba Group, announced plans Monday for an initial public stock offering that could become the world's biggest since the start of the coronavirus pandemic. (AP Photo/Ng Han Guan)

The app for Alipay, the mobile payments service operated by Ant Group, is seen on a smartphone in Beijing on Monday, July 20, 2020. Ant Group, the online payments arm of e-commerce giant Alibaba Group, announced plans Monday for an initial public stock offering that could become the world's biggest since the start of the coronavirus pandemic. (AP Photo/Ng Han Guan)

Chinese fintech  received approval from the for the Shanghai portion of its blockbuster initial public offering, which is the last step in the review process and a milestone that comes days after it reportedly got a green light for the Hong Kong portion of its highly anticipated dual listing.

The company is now eyeing completing its dual listings over the next few weeks, Reuters reported. A spokesperson for Ant Group declined to comment on the IPO timetable going forward.

The last necessary approval was made public Wednesday as part of a new batch of documents posted to the CSRC’s website that are part of the IPO process to list on the Shanghai Stock Exchange’s STAR Market. The fintech reportedly got permission on Monday from the HKEX’s Listing Committee for its Hong Kong portion, after the CSRC also approved that listing. Shanghai's listing committee had already signed off on the listing in September.

The approvals come days after the fintech raised its IPO valuation target from $250 billion to at least $280 billion, Bloomberg reported. The company is seeking to raise $35 billion from the IPO, according to Bloomberg, which also reported that it has added ICBC International, Barclays and BOC International as joint book runners for its Hong Kong listing.

Ant Group first disclosed its dual IPO plans in July and submitted detailed paperwork in August.

The fintech notes in its Hong Kong paperwork that it is controlled by Alibaba co-founder Jack Ma and that the e-commerce company has a 33% stake in it. It also notes that its business was part of Alibaba before a 2011 spinoff.

The company, which reported strong revenue and profit growth over a multi-year period, also detailed how its payments segment makes up a dwindling share of its revenue. The Hong Kong document shows that the segment contributed 54.9% in 2017 but just 35.9% for the first half of 2020. In contrast, Ant Group said that its financial technology platforms segment, which includes its credit, investment and insurance businesses, went from a 44.3% contribution in 2017 to 63.4% by the first half of 2020.

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