Ant Group founder Jack Ma to give up control in key revamp

Jack Ma's ceding of control comes as Ant Group is nearing the completion of regulatory-driven restructuring, with Chinese authorities poised to impose a fine of more than $1 billion on the firm — part of Beijing's unprecedented crackdown on technology titans

Ant Group's founder Jack Ma will give up control of the Chinese fintech giant in an overhaul that seeks to draw a line under a regulatory crackdown that was triggered soon after its mammoth stock market debut was scuppered two years ago.

Ant's $37 billion IPO, which would have been the world's largest, was cancelled at the last minute in November 2020, leading to a forced restructuring of the financial technology firm and speculation the Chinese billionaire would have to cede control.

While some analysts have said a relinquishing of control could clear the way for the company to revive its IPO, the changes announced by the group on Saturday, however, are likely to result in a further delay due to listing regulations.

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.

A former English teacher, Mr. Ma previously possessed more than 50% of voting rights at Ant but the changes will mean that his share falls to 6.2%, according to Reuters calculations.

Mr. Ma only owns a 10% stake in Ant, an affiliate of e-commerce giant Alibaba Group Holding Ltd, but has exercised control over the company through related entities, according to Ant's IPO prospectus filed with the exchanges in 2020.

Hangzhou Yunbo, an investment vehicle for Mr. Ma, had control over two other entities that own a combined 50.5% stake of Ant, the prospectus showed.