Jack Ma To Give Up Control Of Chinese Fintech Giant, Ant Group

Ant Group’s founder, Jack Ma, will likely give up control of the Chinese fintech giant in a major revamp billed to take place soon.

This comes as Ant Group, in a statement released on Saturday, disclosed that it is about to make adjustments to enhance the stability of its corporate structure and sustainability of its long-term development.

Ma, a Chinese Billionaire, has control of over 50 per cent of voting rights in the financial technology company, which would be reduced to 6.2 per cent, according to the statement from the company.

The group which owns the world’s largest mobile payment platform, Alipay, said the major goal of the adjustment is to change the exercise of voting rights of Ant Group’s major shareholders.

Part of Ant Group’s statement reads: “The adjustment is being implemented to further enhance the stability of our corporate structure and sustainability of our long-term development.

“The main result of the Adjustment will be to change the exercise of voting rights of Ant Group’s major shareholders, from Mr Jack Ma exercising voting rights jointly with persons acting in concert, to each of ten individuals (including the founder, representative of our management and employees) exercising their voting rights independently.”

Ant Group which was founded in October 2014 by Mr Ma, manages the Alipay platform which serves over 1.3 billion users and 80 million merchants, with total payment volume (TPV) reaching ¥118 trillion RMB in June 2020. According to 2022 Fintech ranking by the Centre for Finance, Technology and Entrepreneurship, it is the fourth largest financial services corporation in the world, coming behind Visa, Mastercard, Tencent.

According to Reuters report, trouble for the company started when its $37 billion Initial Public Offering (IPO) which would have been the world’s largest, was cancelled at the last minute in November 2020 by Chinese financial regulators, leading to a forced restructuring of the company and speculations that Ma would have to relinquish his major control.

The report further pointed out that while some analysts believe that adjusting control of voting rights by major shareholders could pave the way for the Ant Group to revive its IPO, the changes announced by the company, however, are likely to result in a further delay due to listing regulations for China’s Stock market.

China’s domestic A-share market requires companies to wait three years after a change in control to list. The wait is two years on Shanghai’s Nasdaq-style STAR market, and one year in Hong Kong,” Reuters stated in its January 7, Reuters report indicated.

Ant Group is an affiliate of a multinational technology giant, Alibaba Group also founded by Mr Jack Ma in June 1999.