Behold the giant Ant . . .
Ant Group, the parent company of China’s largest mobile payment company Alipay, announced the world's largest initial public offering (IPO) yesterday. The IPO took place on the Hong Kong stock exchange (HKEX), and the HKEX will publicly list Ant Group’s shares on November 5. According to the prospectus submitted to the HKEX, Ant Group will offer over 1.67 billion shares priced at 80 Hong Kong dollars (C$14) each. In tandem with the HKEX listing, the company will also list on the Shanghai Stock Exchange’s STAR market. This dual listing is expected to be the world’s largest IPO – surpassing the previous record holder, Saudi Aramco.
Note the location of the listing . . .
The record-breaking C$50-billion listing is monumental, not only for its size but also for the locations in which it is occurring. The fact that the listing is taking place outside of New York City reflects a wider trend among Chinese tech companies. In the words of the co-founder of Ant Group, Jack Ma, a listing of this scale would have been inconceivable outside NYC even three years ago. Over the past year, however, there has been a thunderous march of Chinese tech companies choosing to delist from New York and “come back home” to China.
Canadian retailers ask: MasterCard or Alipay?
Although Ant Group’s IPO valuation now arguably puts it on par with MasterCard and JP Morgan Chase and way above the league of the likes of PayPal, do not expect it to become a large player in the Canadian market in the near future. Ant Group’s Alipay is almost exclusively used in China, and its parent company Ant Group may soon be caught up in the U.S.-China conflict. The Trump administration has weighed blocking Ant Group from operating in the U.S., and in 2018 blocked its attempt to purchase an American money transfer company over security concerns.
- Bloomberg: The pessimist’s guide to Jack Ma’s record breaking Ant IPO
- Financial Times: Ant Group under scrutiny over exclusive sale of shares in IPO
- Wall Street Journal: Ant Group raises more than $34 billion in record IPO