Ant Group’s Value Could Be Cut Further Due To China’s Antitrust Concerns

Chinse billionaire Jack Ma keeps getting hit with setbacks. It all started in November when the Shanghai Stock Exchange acted to delay his Ant Group’s plan to go public, after he met with Chinese regulators.

Before the scheduled initial public offering (IPO) was canceled, Ant Group was worth an estimated $316 billion. That was then.

Bloomberg reported Thursday (Jan. 21) that Ant’s valuation may fall all the way to $108 billion due to antitrust concerns. That could happen under Chinese regulators’ proposals to curb market concentration in the country’s online payments market,

Ant, best known for its Alipay payments service, calls itself a financial technology company (FinTech). But China’s financial regulators are starting to view it as being more like a bank.

A big problem for Ma: The value of Ant’s Alipay service could be cut in half by proposed regulations, according to analyst Francis Chan at Bloomberg Intelligence. Chan had already cut the estimated worth of Ant this month.

“Ant Group’s valuation may plunge further if its payment unit is forced to break up due to potential anti-trust probes by China’s central bank,” Chan wrote in a research note.

China’s central bank said on Wednesday (Jan. 20) that any non-bank payments company with half the market share for online transactions, or two entities with a combined two-thirds share could be subject to antitrust probes, Bloomberg reported.

Ma had been out of the public eye for nearly three months, until he resurfaced this week to give an online speech to rural teachers in China.

Ma had reportedly dropped out of sight after his IPO was scrapped by Chinese regulators. This happened following a controversial speech he gave at a Shanghai financial forum in October.

The event for rural teachers is hosted annually by Ma. The video shows him touring an elementary school in Hangzhou, where he grew up.

In the online speech, he didn’t mention the IPO disaster. Ma is also the founder of the Alibaba Group.