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Ant Financial: oversubscribed IPO makes billionaire Jack Ma even richer

2020-10-27T12:06:21.502Z


The demand for Ant shares is so great that the Chinese fintech is closing the books prematurely for its world record IPO. Some of the beneficiaries of the issue are already certain: participating banks and China's tech billionaire Jack Ma.


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Alibaba founder Jack Ma

Photo: PHILIPPE LOPEZ / AFP

The demand for shares in the Chinese fintech Ant Group is huge.

The operator of the payment service Alipay wants to close the books for the largest IPO of all time earlier than planned, as insiders said.

In Hong Kong, institutional investors would only be able to subscribe for shares until Wednesday, November 4th at 5 p.m. instead of Thursday, November 5th, as previously planned.

The first day of trading in the papers is also planned for November 5th.

The books were oversubscribed within the first hour of the subscription period, insiders said.

Ant didn't want to comment on that.

The Chinese group, which belongs to the Amazon rival Alibaba, wants to collect more than 34 billion dollars in its IPO in Hong Kong and Shanghai - half on each of the two stock exchanges.

As reported by the US broadcaster CNBC, Ant is selling its papers in Shanghai at 68.8 yuan each (around 8.70 euros).

In Hong Kong, the shares should cost 80 Hong Kong dollars each (currently around 8.73 euros).

In the Hong Kong listing alone, 97.5 percent of the securities are reported to go to institutional investors as a first step.

With the planned volume of 34.5 billion dollars, Ant would surpass the previous record emission of the oil giant Saudi Aramco, which had raised 29.4 billion dollars last year.

In mid-October, insiders had signaled a total valuation of around 280 billion dollars for the Ant Group (239 billion euros).

Big payday for participating banks

With Alipay, Ant operates the dominant payment service in China and also offers loans, insurance and wealth management services via apps.

In the first nine months of 2020, Ant increased operating income 42.6 percent to the equivalent of $ 17.8 billion.

The Ant IPO, meanwhile, will also pay off for the banks involved in organizing the deal.

According to a report by Bloomberg, the institutes can expect total fee income of around 396 million dollars, which even seems comparatively modest.

According to Bloomberg, the calculation is based on a fee rate of 1 percent - according to the information, fees of an average of 1.45 percent are common for deals of this type.

more on the subject

  • World's Largest IPO: China's Ant wants to take nearly $ 35 billion on the stock market

  • Banks, tech, car manufacturers: these are the largest IPOs in the world to date

  • Before the record IPO: Ant Financial's incredible business model and its pitfalls An original text from the "Economist"

As Bloomberg reports, it will only be decided in a few days how the fees will be divided up among the banks involved.

Presumably, however, the leading banks of the transaction will take most of the pie, in this case Citigroup, JP Morgan, Morgan Stanley and China International Capital Corp.

Jack Ma continues to climb the world's richest list

One who will also benefit greatly from Ant's IPO is Alibaba founder and major Ant shareholder

Jack Ma

(56).

According to calculations by Bloomberg, the former English teacher will probably climb to eleventh place on the world's richest list as a result of the IPO.

Bloomberg is currently listing the Chinese Ma, with assets of around $ 61 billion, in 17th place in its billionaire rankings.

Ma owns an 8.8 percent stake in Ant and its net worth is expected to grow to $ 71.1 billion as a result of the IPO, the report said.

With that, the Alibaba founder would pass Oracle boss

Larry Ellison

(76), L'Oreal heiress

Francoise Bettencourt Meyers

(67) and some representatives of the Walton clan.

However, Ma is still a bit away from his online retail arch-rival: Amazon founder

Jeff Bezos

(56) is currently at the top of the global richest rankings with a fortune of around 189 billion dollars, according to Bloomberg Ant's IPO won't change anything either.

cr / Reuters

Source: spiegel

All news articles on 2020-10-27

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