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E-commerce billionaire Jack Ma will cede control of fintech giant Ant Group, the leading Chinese financial technology provider he founded.
Key points:
- Jack Ma will cede control of Chinese fintech giant Ant Group
- He has maintained a low profile since criticising regulators’ attitude to tech companies two years ago
- Mr Ma previously possessed more than 50 per cent of voting rights at Ant but the changes will mean that his share falls to 6.2 per cent
The move comes after Chinese regulators suddenly pulled the plug on the company's stock market debut two years ago, and a crackdown on the nation's tech sector targeting the outspoken entrepreneur.
The company said in a statement on Friday that after an ownership restructuring, "no shareholder, alone or with other parties" will have "control over Ant Group".
Rewind to November 2020, Ant's $US37 billion initial public offering (IPO), which would have been the world's largest, was cancelled at the last minute.
It led to a forced restructuring of the financial technology firm and speculation Mr Ma would have to cede control.
While some analysts have said a relinquishing of control could clear the way for the company to revive its IPO, the changes announced by the group on Friday are likely to result in a further delay due to listing regulations.
Mr Ma previously possessed more than 50 per cent of voting rights at Ant but the changes will mean that his share falls to 6.2 per cent, according to Reuters calculations.
The company is an affiliate of e-commerce giant Alibaba, which Mr Ma – a former English teacher — also founded.
'Unregulated' territory
The move follows other efforts over the years by the Chinese government to rein in Mr Ma and the country's tech sector more broadly.
China's digital economy has been booming since the 1990s and the coronavirus pandemic saw many retailers rush to grow their online presence.
The once high-profile Mr Ma largely disappeared from view for months after openly criticising China's banking system, two years ago.
At the time the government forced Ant Group to call off its highly anticipated IPO that would have raised more than $US3 billion, days before it was to launch.
Mr Ma's surrender of control comes after other signs the government was easing up on Chinese online firms. Late last year Beijing signalled at an economic work conference that it would support technology firms to boost economic growth and create more jobs.
The government last month said it would allow Ant Group to raise $US1.5 billion in capital for its consumer finance unit.
AP/ Reuters