Ant Financial, the fintech branch of Chinese e-commerce company Alibaba will evolve into a financial holding company ahead of another run at a public listing, the Wall Street Journal reported on Wednesday.
Ant Group submitted a plan of the proposed restructuring to regulators that will place the company under harsher capital requirements, according to people familiar with the matter.
The plan could be finalized later next month they said, after which the financial company may be on track to list publicly later this year.
"Once the problem [is] solved it will go back to the track to continue consideration according to law," China's central bank governor Yi Gang said on Monday in response to questions about Ant's IPO delay.
Rumors of restructuring as a holding company circulated in late December and follow a plan drawn up by Ant itself in its August initial public offering prospectus suggesting it might set up a unit, Zhejian Finance Credit Network Technology, to apply for a financial holding license without specifying which parts of the company would be involved.
But the latest arrangement reported by The Journal puts the entire Ant Group on course to become a financial holding company and subject to strict regulatory oversight similar to what Chinese banks must abide by.
Concerned with Ant's expansion into consumer lending and wealth management, regulators derailed its $37 billion initial public offering in November and have since sought to contain the expansive e-commerce companies of founder Jack Ma.
"Good innovations are not afraid of supervision, but they do fear outdated supervision," he said at a financial summit in Shanghai on Oct. 24, 2020. "Today the world, especially China, needs a lot of policy experts, but not experts in red-tape."
Days later, the much-anticipated dual listing of Alibaba fintech offshoot Ant Group on the Hong Kong and Shanghai bourses was delayed indefinitely by regulators.
Ma appeared for the first time in months last week in a short clip circulated by Chinese state media groups in which he congratulated recipients of awards from his eponymous charitable organization.
The value of Alibaba shares on the Hong Kong Stock Exchange jumped 11% the day after the publication of the video to hit its highest price in six months.
