Jack Ma abandons control of Ant Group (Alibaba)

Ant Group has overhauled its shareholder structure, diluting founder Jack Ma's voting power to make China's largest fintech company more "transparent and diversified," a crucial step deemed necessary to get its long-awaited initial public offering back on track ( IPO). Ant Group controls, among other things, Alibaba, the largest online commerce site in the world.
According to a statement released on Saturday, Ma will end a pact of understanding with Ant chairman Eric Jing, former chief executive Simon Hu and Alibaba Group Holding veteran Jiang Fang, which gave Ma 53.46 percent of the stake. voting power in fintech society.
After the restructuring, major shareholders "will independently exercise their voting rights," Ant said. “No shareholder, alone or together with another shareholder, will have the power to control the outcome of the general meetings of Ant”, or “appoint the majority of the board of directors of Ant”, and “therefore… have control over Ant ”.
The restructuring is the most substantial change made to the world's largest fintech company amid regulatory scrutiny following the postponement of a $39.7 billion share sale in Shanghai and Hong Kong in November 2020.

“It's definitely a clear sign that the government has eased restrictions on China's big tech platforms,” said Dai Ming, a fund manager at Huichen Asset Management in Shanghai. “We can also say that it is a step forward for the recovery of the Ant listing”.
Ant, based in the Zhejiang provincial capital Hangzhou, has undertaken several initiatives since 2021 to restructure itself. The company plans to add a fifth independent director, who will make up more than half of the nine-member board. To further separate from parent company Alibaba, some executives have exited the Alibaba Partnership, a set of the company's most powerful executives.

Ant is dissolving his ties to Alibaba, which he shares with its founder Ma, as part of the former English teacher's long-pursued strategy to exit after founding one of China's largest private companies. Ma retired on his 55th birthday in 2019, but remains a shareholder and life partner in the companies he founded.
"It appears that Jack Ma has relinquished control of Ant and this may open an opportunity for new investors to enter, which could be state capital or other types of private equity," said Li Chengdong, head of think tank Dolphin for the internet sector. “I don't think Ant's IPO is imminent, as China prioritizes raising assets for the hi-tech sector, but it would be easier to clear an IPO if Ant's capital and control issues are resolved ”.
The suspension of Ant's IPO in 2020, just 48 hours after the start of trading, marked a watershed moment in the relationship between Chinese regulators and the country's Big Tech companies, marking the end of the era of runaway growth of some of China's most valuable internet companies. On the one hand, today's operation sees the easing of government control over large companies, on the other it paves the way for a long-awaited public listing of Ant Group.

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The article Jack Ma abandons control of Ant Group (Alibaba) comes from Scenari Economici .

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This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/jack-ma-abbandona-il-controllo-di-ant-group-alibaba/ on Sat, 07 Jan 2023 10:23:54 +0000.