Alibaba Will Buy a Fifth of Shares in Ant Group’s Mega IPO

(Bloomberg) -- Alibaba Group Holding Ltd. has agreed to subscribe to more than a fifth of Ant Group’s imminent initial public offering, propping up its part-owned fintech giant’s potentially $35 billion debut.Asia’s largest corporation will buy 730 million of about 1.67 billion Shanghai-listed A shares as part of a placement to strategic investors, the e-commerce giant said in a stock exchange filing. Including the Hong Kong tranche of its IPO, Ant intends to sell a total of 3.3 billion shares. In addition, the financial services giant plans to issue about 1.16 billion Hong Kong-listed or H shares to Alibaba, part of a distribution of about 3.26 billion shares to existing backers.Alibaba co-founder Jack Ma’s Ant Group is racing toward what could be the world’s largest ever coming-out party, slated for sometime over the coming weeks. The IPO is said to have drawn strategic investors including Singapore’s sovereign wealth fund GIC Pte, Temasek Holdings Plc and China’s $318 billion National Council for Social Security Fund.That strong demand means the Alipay operator could fetch a valuation of at least $280 billion, despite concern that people within the Trump administration are exploring restrictions on the Chinese fintech giant, according to people familiar with the matter. Ant reported a 74% jump in gross profit to 69.5 billion yuan ($10.4 billion) from January to September, according to an A-share prospectus posted to the Shanghai exchange.Read more: Jack Ma’s Ant Group Raises IPO Valuation Target to $280 BillionFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

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