Billionaire Jack Ma, one of China’s most noted entrepreneurs, could be giving up control of Ant Group.
This move would further separate the company from affiliate Alibaba after regulators in the country turned up the heat on big tech firms more than a year ago, the Wall Street Journal reported on Thursday (July 28), citing unnamed sources with insider information.
Hangzhou Yunbo, an investment vehicle for Ma, has control over two other entities that own a combined 50.5% stake in Ant Group. Ma has a 34% stake in Hangzhou Yunbo, with the other 66% split between Ant CEO Eric Jing, former CEO Simon Hu, and veteran Alibaba executive and former Ant nonexecutive director Fang Jiang.
Ma has veto power over Hangzhou Yunbo’s decisions, which gives the other executives a hand in Ant’s operations without changing control, which could hold up an initial public offering (IPO), one of the sources told the WSJ.
See also: Ant Group Execs Step Away From Alibaba Amid Probes in China
Against a backdrop of increased regulatory oversight, Ant Group and Alibaba have increasingly been seeking to distance themselves from one another, PYMNTS reported earlier this week. CEO and Chairman Eric Jing and CTO Xingjun Ni left Alibaba four months ago along with seven other executives,
Ma could relinquish control of Ant Group by transferring a percentage of his stake to other executives, thereby diluting his voting power, a source told the WSJ.
Reducing his stake could revive Ant’s planned record 2020 IPO, halted by regulators during a crackdown.
Ant Group told regulators of Ma’s plan to give up control as the company prepared to convert into a financial holding company, the sources told the WSJ. While the change wasn’t required, regulators have given it the green light, the sources said.
Related: Ant Group Intros ANEXT Bank in Singapore
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