The $60 billion IPO of Ant Financial has been placed on hold until early 2018, according to bankers familiar with the matter.
Ant Financial, the company behind the popular Chinese payment service Alipay Mobile and Alibaba affiliate, has had it’s IPO delayed due to the company’s need to secure regulatory approval.
The company was valued at $60 billion in April of 2016, twice the valuation of recently public Snap Inc. which was valued at roughly $30 billion. Ant Financial has recently been buying up overseas assets in the US, South Korea, and India.
A source told the Financial Times: “Ant would like to convert into an [overseas] shareholding, and it needs the blessing of government to do that.”
“And in a year of political uncertainty and manoeuvring, no one is making decisions.”
The political uncertainty refers to the meeting of China’s Communist Party this year which will undergo its once every 5 year reshuffle to select key posts in the government. Listing overseas would require Ant to have the backing of Beijing.
It is more likely than not that Ant would be able to secure an overseas waiver from Beijing but the regulations are unclear and only a small amount of Chinese payment companies have ever achieved being listed overseas.
When the company restructured as a Chinese company, Jack Ma took the company out of Alibaba in 2011 and under his direct control. The move was seen as controversial and met with some protest. Yahooo at the time was a 40% stake holder in the company.
Recetnyl, Ant Financial and Alibaba have bid $1.2 billion for Moneygram, invested $200 million in South Korean app based messaging service Kakao, and a $177 million controlling stake in Indian firm Paytm’s ecommerce division.
Ant Financial also offers several other services including the world’s largest money market fund, Yu’e Bao, which manages $165 billion.
Shares in Alibaba have risen 38% since New Year.