Ant Group to Become Financial Holding Company as Part of Alibaba Settlement
The People’s Bank of China (PBoC) confirmed Monday that Jack Ma’s giant Ant Group will restructure as a financial holdings company.
Ant Group whose $37 billion initial public offering (IPO)
was suspended by China’s regulators in November, will restructure as a
financial holding company, according to a CNBC report.
The terms of the restructuring are expected to curb Ant
Group’s profitability and valuation.
Two days ago, Chinese regulators hit Alibaba with a $2.8
billion fine as part of its anti-monopoly investigation of the tech giant,
claiming the company had abused its market dominance. The restructuring of Ant
Group is part of the terms of the settlement of those claims, CNBC said.
The PBoC said that under a “comprehensive and feasible
restructuring plan” Ant Group would cut the “improper” linkage with payments
services including AliPay, Jiebei, and Huabei, said the report.
In February, it emerged Chinese regulators had agreed on a
restructuring plan with Ant Group that would combine all its business segments,
including its blockchain arm, into a financial holding company, according to a
Bloomberg report citing people familiar with the matter.
Ant Group is known for its major subsidiaries including
Alipay and Kakao, but it also has a blockchain arm offering services based on
its own AntChain technology.
The outspoken billionaire Jack Ma is the founder of Alibaba
and its affiliate Ant Group, and has been keeping a low profile since October
when he publicly criticized China’s financial system and its state-dominated
banking sector at a Shanghai event.
Recently, PBoC Digital Currency Research Institute director
Mu Changchun has been openly discussing the central bank’s own digital currency
and the need to address privacy issues, stating “a completely anonymous central
bank digital currency is not feasible” as it would violate anti-money
laundering regulations.
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