According to a person familiar with regulators’ thoughts and two people with near links to the firm, Ant Group is discussing options for founder Jack Ma to divest his share in the financial technology giant and relinquish influence, as meetings with Chinese regulators indicated to the company that the decision might help draw a line under Beijing’s oversight of its sector.
For the first time, Reuters is focusing on the current round of meetings and negotiations about the future of Ma’s power over Ant, which is exerted through a complex system of investment vehicles. The Wall Street Journal previously announced that Ma promised to fork over pieces of Ant, to the Chinese government at a November meeting with regulators.
According to accounts given by a source familiar with the regulators’ thought, and one of the origins containing cl, officials from the People’s Bank of China (PBOC), financial regulator China Banking and Insurance Regulatory Commission (CBIRC) met separately with Ma and Ant between January and March, where the prospect of the tycoon’s departure from the business was addressed.
Ant denied that it had ever considered selling Ma’s share. “Divestment of Mr. Ma’s stake in Ant Group has never been discussed with anyone,” said an Ant spokesperson in a tweet.
Reuters was unable to ascertain whether Ant and Ma would choose a divestment alternative, and if so, which one. According to one source with business connections, the company hoped Ma’s share, worth billions of dollars, could be sold to current investors in Ant or its e-commerce partner Alibaba Group Holding Ltd., without involving any external party.
However, according to a second source with business contacts, Ma was advised during meetings with regulators that he would not be able to sell his share to any agency or person similar to him, and would instead have to exit entirely. According to the author, another alternative will be to sell his share to a Chinese businessman with ties to the government.
Any change will need Beijing’s permission, according to both sources with knowledge of the company’s thought.
In terms of the timetable for how talks have progressed over the last few months, the accounts given by all three outlets are clear. According to one business source, Ma met with regulators more than once before the Chinese New Year, which was in early February. According to the second report, Ant began considering alternatives for Ma’s potential exit about two months ago. According to a source familiar with the regulators’ thought, Ant advised officials during a meeting before mid-March, that it was working on alternatives.
One of the sources with business links has been updated on Ma’s contacts with regulators and Ant’s intentions, while another source familiar with regulators’ opinions is well aware of Ant-official sessions. The other has prior experience of Ant’s option discussions. Because of the seriousness of the case, they demanded anonymity.
Ma’s remarks were not given by the Ant spokesperson. Ant was replied to by Alibaba. Reuters’ request for comment via Ant was not responded to by Jack Ma’s office. Requests for comment were also not responded to by the State Council Information Office, PBOC, or CBIRC.
The high-stakes discussions take place in the midst of a revamp of Ant and a wider regulatory crackdown on China’s technology market, which was triggered by Ma’s public rebuke of regulators in a speech last October.
According to both sources close to the group, Ma’s departure could help pave the way for Ant to restart efforts to go public, which stalled following the tycoon’s address. Ant, which was planning to collect an unprecedented $37 billion in what would have been the world’s biggest initial public offering, cancelled plans the day after Ma’s meeting with regulators on Nov. 2.
‘Too broad for their britches,’ they claim.
Since then, Beijing has launched a slew of probes and new laws that have not only curtailed Ma’s empire but also spread into the country’s technology market, encompassing other high-profile, billionaire entrepreneurs.
The repercussions have been especially serious for Ma, 56, who co-founded Alibaba and once had cult-like esteem in China. After a fleeting appearance in January, the tycoon retreated entirely from the public eye for about three months and has maintained a low profile ever since.
