Breaking News
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Ant Group’s Halted IPO Shocks Investors, Teaches Hard Lesson

Stock MarketsNov 05, 2020 12:20AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters

By Gina Lee – Investors are still reeling from the shock of Ant Group Co. halting its dual listing in Shanghai and Hong Kong on Tuesday, two days before shares were set to trade in the $35 billion listing, the world’s largest to date.

Alibaba (NYSE:BABA) Group Holding (HK:9988), Ant Group’s parent company, saw its shares soar 5.92% to HK$293.60 ($37.86) by 1:17 AM ET (5:17 AM GMT) on Thursday. They plunged by up to 7.5% immediately after the halt was announced. Alibaba founder Jack Ma saw almost $3 billion shaved off his fortune.

Ant Group was forced to halt the listing after Chinese regulators withdrew their approval, citing a “significant change” in the regulatory environment but declining to provide further details.

Some investors view the halt as sensible, with Ant Group’s business model allowing it to charge higher fees for transactions while most of the risk in need of regulation was taken on by state-run banks.

Ma also put his foot in his mouth when he blamed global regulators for focusing too much on risk and critiqued Chinese measures for stifling innovation during a conference in Shanghai on Oct. 24. The comments came just before the Communist Party’s plenum to hash out the country’s five and 15-year economic plans. The plenum also released new rules affecting Ant’s businesses and summoned Ma to a meeting in Beijing on Monday.

Despite the public reprimand and reputational blow to the transparency of Chinese markets, other investors remained optimistic about the IPO.

“What’s clear to me is that the lending business will grow slower over the next few years. That, in the larger scheme of things, is net positive for the sector and Ant Group. Steady growth is good,” Octahedron Capital Management founder Ram Parameswaran told Bloomberg.

Investors will have learnt from Ant Group’s experience to factor in the political risk in future business decisions. This will likely increase in importance, with China facing continuous pressure from the U.S. as it develops its own core technologies no matter who wins the presidential election.

“This sends a signal to the major tech players not to get too big for their britches and that the party is still in charge. Internationally, however, moves like this do very little to alleviate concerns that tech companies going out are not having their strings pulled by Beijing,” Trivium China consultancy head of digital research Kendra Schaefer told Bloomberg.

Ant Group’s Halted IPO Shocks Investors, Teaches Hard Lesson

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email