Ant Group: counting the cost
“For years, Alibaba founder Jack Ma has had a safe spot at the top table of Chinese business,” said Henny Sender in the FT. No longer. According to people close to events, it was Xi Jinping himself who pulled the plug on the $37bn listing of Ma’s Ant Group last week, after regulators warned that […]

“For years, Alibaba founder Jack Ma has had a safe spot at the top table of Chinese business,” said Henny Sender in the FT. No longer. According to people close to events, it was Xi Jinping himself who pulled the plug on the $37bn listing of Ma’s Ant Group last week, after regulators warned that the disruptive fintech was in danger of becoming a “monster”. Ant, which has come to dominate mobile payments in China, was “always a threat to the vested interests” of the country’s financial industry – particularly after branching out into areas such as lending. Even some Western analysts have described it as a “parasite”, taking advantage of its freedom from “heavy regulation imposed on deposit-taking banks”. And so “the world’s biggest IPO is now the world’s biggest suspended IPO”, said The Economist. The abrupt volte-face is not just painful for Ant. It also “reflects poorly on China’s regulators”, by highlighting the risks that can trip up even its most successful companies. “There’s no need to weep for Ant,” said Rui Ma on Tortoise: the firm is expected to survive. “It’s Jack Ma whose recovery is less certain.” As an entrepreneur out on a limb, he “pushed until Beijing pushed back” – and learnt the hard way that “fame and prodigious wealth are no match for a determined dictator”.