Ant Group, Alibaba’s FinTech arm and China’s dominant mobile payments business, filed for a dual listing in Hong Kong and on Shanghai’s Nasdaq-style STAR Market. The listings could raise $30 billion in what would be the world’s biggest IPO.
Ant’s first public offering would be the first simultaneous record in Hong Kong and the year old STAR Market, boosting Hong Kong’s status as an global IPO market and helping enhance STAR for a capital markets centre.
Ant, already the world’s most valuable unicorn – or – unlisted tech firm – didn’t disclose the size, timetable or other important details of this offering in its preliminary prospectus.
Individuals with knowledge of this matter have previously said Ant plans to increase more than $20 billion in the dual-listing that could happen in October, valuing the group at over $200 billion.
The offering size could even reach $30 billion if market conditions permit, said three of those people this week.
That would make it the world’s largest IPO because oil giant Saudi Aramco increased $29.4 billion last December, which surpassed the record set by China’s Alibaba Group Holding Ltd’s $25 billion float in 2014.
Ant seems to sell between 10 percent and 15 percent of its shares, among the sources mentioned, requesting anonymity because the particulars were not yet public. Ant said in its filing that it plans to sell no less than 10% of its enlarged share capital in the dual-listing.
The business was valued at roughly $150 billion in its final funding round in 2018, which brought in big-name investors like Temasek Holdings and Warburg Pincus.
Ant plans to utilise the profits raised to expand its consumer base and cross-border obligations in addition to enhancing its research and development capabilities.
BOOST FOR HONG KONG
Ant’s prospectus gave shareholders the very first look at the firm’s financial well being before the IPO.
The company said earnings was 72.5 billion yuan (approximately $10.5 billion) in the first half of this year, up nearly 40 percent in comparison with the same period in 2019. Gain rose nearly 12 times to 21.9 billion yuan in precisely the exact same period.
The figures underscore how Ant, 33%-owned by Alibaba and commanded by Alibaba founder Jack Ma, has stayed resilient even as the coronavirus pandemic has crippled many businesses.
Ant has amassed a selection of financial licenses such as payments, online banking, insurance and micro lending to function in China’s vast financial market.
Its largest and best-known business is Alipay, the most significant player in China’s 430 trillion yuan (approximately $62 trillion) third-party mobile payments marketplace, according to market researcher Qianzhan.
Alipay had 711 million monthly active users as of June, together with payment volumes reaching 118 trillion yuan in China, Ant’s figures showed.
Alibaba set up Alipay at 2004, modelling the company on American peer PayPal Holdings Inc, to help Chinese buyers store online. It spun off the unit which operated the online payments stage in 2011 within the objections of shareholders ahead of its IPO.
It re-branded the device as Ant Financial in October 2014 and in May it was renamed Ant Group.
Both Hong Kong and mainland China are working to raise their appeal as areas to raise cash.
The float could be a boost to the town’s status as an international capital markets centre as its leaders come under fire for its imposition of a national security law by Beijing criticised from the West as draconian.
Companies raised $10.3 billion via IPOs on the STAR Market in the first seven months of the year, which makes the bourse the second-biggest market worldwide for such listings, supporting Nasdaq but forward of Shanghai’s main plank and Hong Kong, Refinitiv statistics showed.
The team at Platform Executive hope you have enjoyed this news article. Initial reporting via our content partners at Thomson Reuters. Reporting by Julie Zhu. Additional reporting by Yingzhi Yang and Sumeet Chatterjee. Editing by Christopher Cushing, Jason Neely, Susan Fenton and Kirsten Donovan.
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