Famous Chinese billionaire gives up control of his company under pressure from Beijing
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Chinese billionaire Jack Ma returned to the public scene after more than two years away, to cede control of his company Ant Group
After more than two years of disappearing from the public scene, Chinese billionaire Jack Ma returned to the headlines after ceding control of Ant Group, a fintech company, under alleged pressure from the Chinese government.
According to an Ant Group statement released this Saturday, a readjustment in the voting rights structure was decided, diluting the power of founder Jack Ma to make the company more “transparent and diversified.”
“The main result of the Adjustment will be to change the exercise of the voting rights of the principal shareholders of Ant Group, from Mr. Jack Ma exercising the voting rights jointly with persons acting in concert, to each of all ten people (including the founder, our management representative and employees) exercise their voting rights independently ,” Ant Group reported in the statement.
The Hong Kong newspaper South China Morning Post highlights that this decision would be a crucial step that is considered necessary to get its long-awaited initial public offering (IPO) back on track, which was stopped by the Chinese government in 2020.
With the restructuring, Ma ends a shareholder pact with Ant Chairman Eric Jing, former CEO Simon Hu and Alibaba Group Holding veteran Jiang Fang, which gave Ma 53.46% of the power of vote in fintech company. After the adjustment, it will have 6.2% of the voting rights.
“No shareholder, alone or jointly with another shareholder, shall have the power to control the outcome of Ant Group's general meetings. No shareholder shall have the power to appoint a majority of the members of Ant Group's board of directors. Therefore, no shareholder, alone or jointly with other parties, will have control over Ant Group,” the statement read.
Ant Group owns Alipay, the world's largest digital payment platform, with hundreds of millions of monthly users in China and beyond.
Ma's problems with the Chinese government
In 2020 Ant Group, led by Ma, is preparing to go public in Hong Kong, but 48 hours before doing so, that action was stopped by the Chinese government.
The Hong Kong IPO was estimated at $34 billion and was a record at the time.
It is speculated that Beijing's block on the IPO was due to scathing comments about government regulators made by Jack Ma days earlier.
In a speech at a summit in Shanghai, the tycoon said banks operated with a “pawnshop” mentality and accused financial watchdogs of stifling growth.
Until before the incident, Ma was one of China's most renowned businessmen, with an unusual track record and a charismatic personality.
After the confrontation with the Chinese government, the former English teacher withdrew from the public scene for more than two years, until yesterday when he reappeared in a restaurant in Thailand hours before Ant Group said it would cede control of the company.
Jay Fai restaurant in Bangkok, Thailand, posted a photo of Ma on Instagram on Friday, where he appears to have just visited the venue.