Alibaba's Jack Ma says Ant Group IPO is 'world's largest'

Suban Abdulla
·4 min read
Ant's dual-listing in Hong Kong Stock Exchange and Shanghai's STAR Market got the green light from China last week. Photo: STR / AFP via Getty Images
Ant's dual-listing in Hong Kong Stock Exchange and Shanghai's STAR Market got the green light from China last week. Photo: STR / AFP via Getty Images

The blockbuster dual-listing for China’s Ant Group will be the world's biggest, according to a pricing determined on Friday, Alibaba (BABA) founder Jack Ma said.

In August, the Chinese fintech giant unveiled plans for a dual-listing stock market debut in Hong Kong (0388.HK) and on the Shanghai Stock Exchange's Star Market. That request got the green light from China last week.

“It’s the first time that the pricing of such a big listing - the largest in human history - has been determined outside New York City” he told the Bund Summit in the eastern financial hub of Shanghai.

“We didn’t dare to think about it five years ago, or even three years ago. But a miracle just occurred,” he told the audience, which included officials from China’s regulators.

Ma didn’t specify the exact details of the pricing which is expected to be officially announced next week.

Ant, backed by Chinese e-commerce giant Alibaba could raise as much as $35bn (£27bn) — with the mammoth deal expected to overtake the record $29.4bn set by Saudi Aramco’s IPO in 2019.

As the US-Sino trade war keeps boiling, the Trump administration is said to be considering adding the Ant Group to a trade blacklist, according to sources close to the matter.

The latest dig at China comes ahead of the 3 November election, in which incumbent Donald Trump, who is trailing behind in the polls against Democratic rival Joe Biden, has made a tough approach to China an important foreign policy.

Meanwhile, US election betting odds have put Biden as twice as likely to win than Trump. With odds for the Democratic challenger winning the White House at 67% compared to Trump’s 33%, data from betting exchange Smarkets showed. State-by-state market data implies a 317-221 win for Biden's party.

READ MORE: Jack Ma's Ant Group files for blockbuster $225bn float

Ant, which has an extensive payment and micro-lending business that is largely based on big data, has faced rising scrutiny from regulators.

Ma also criticised the financial and regulatory system, saying it stifles innovation and called for a revamp to extend financial services to more small companies and individuals on the basis of technology — an ethos that Ant is largely based on.

He added that the global system, which was established after World War II was outdated and too risk-averse, calling the Basel Committee on Banking Supervision “an old men’s club.” Ma also warned that risks associated with the system are accumulating in the whole economy.

Calling for a new and “inclusive” banking system he said: “Today’s financial system is the legacy of the Industrial Age.

“We must set up a new one for the next generation and young people. We must reform the current system.”

He also accused Chinese banks’ strong “pawnshop” mentality, which demand collateral and guarantees before lending of “failing to fuel future growth.”

READ MORE: China passes export control law protecting national security and technology

Launched in 2004, Ant was founded by China’s richest man Jack Ma, who also co-founded e-commerce giant Alibaba (BABA), which owns a 33% share in Ant Group. The firm was spun off in 2014 to run Chinese digital payment service Alipay.

According to Bloomberg’s billionaires index, the 55-year-old is the 21st richest person in the world, with an estimated fortune of $53.5bn.

Revenues at Ant rose to $10.5bn in the first half of 2020 — up almost 40% from a year earlier — reporting a $3.2bn profit in the same period.

Headquartered in Hangzhou, Ant’s services are used by more than 700 million people a month, with 80 million merchants using the services to buy insurance, pay bills and invest in mutual funds.

Alipay, China’s largest digital payment, which has around one billion users, overtook American rival PayPal (PYPL) as the world’s largest mobile payments provider six years ago. Last year it acquired UK payment firm World First.

Last week, Alipay launched a new digital copyright services platform powered by AntChain, the company’s platform’s blockchain-based technology.

Watch: Ant’s Hong Kong Listing Wins China Approval