Chinese billionaire and Ant Group’s founder Jack Ma is ceding control of the fintech giant, the company announced on Saturday (Jan. 7). The Ant Group is an affiliate company of the multinational technology company Alibaba Group, also founded by Ma. Ant operates China’s mobile payment app Alipay, the world’s largest, which has more than 1 billion users.
Prior to the change, Ma effectively held 53.46% of the shares of Ant Group through Hangzhou Junhan and Hangzhou Junao Investment Partnerships but the changes will mean that his share falls to 6.2%, according to Reuters calculations.
The tech company said it was adjusting its ownership structure so that “no shareholder, alone or jointly with other parties, will have control over Ant Group.” “The adjustment is being implemented to further enhance the stability of our corporate structure and sustainability of our long-term development,” the Ant statement said. Ten people — including the founder, management and staff — will “exercise their voting rights independently”, it said.
Ma’s relinquishing of control comes as Ant restructures in line with a regulatory crackdown, a crucial step deemed necessary to put its much-anticipated initial public offering (IPO) back on track.
In late 2020, Beijing forced Ant to scrap its $37 billion initial public offering (IPO), which would have been the world’s largest, sending shockwaves in the market. The fintech company had prepared for a dual listing on the Shanghai and Hong Kong stock exchanges.
Ma disappeared from public view in October 2020 after giving a speech criticizing the regulation of tech companies in China. Once China’s richest man, Ma’s net worth has fallen by more than $25 billion since he disappeared from public view, per the Bloomberg Billionaires Index.
On November 3, 2022, the Shanghai Stock Exchange announced that it had suspended the listing of Ant Group due to “significant changes in the financial technology regulatory environment”. This was followed by a similar announcement from the Hong Kong Stock Exchange.
“Jack Ma’s departure from Ant Financial, a company he founded, shows the determination of the Chinese leadership to reduce the influence of large private investors,” Andrew Collier, managing director of Orient Capital Research, told Reuters. “This trend will continue the erosion of the most productive parts of the Chinese economy.”