HONG KONG (Reuters) – Ant Group has received approval from Chinese authorities to set up a $35 billion dual company, two sources familiar with the matter told Reuters on Monday.
The Chinese financial technology company plans to invest in Hong Kong and the Star Market in Shanghai simultaneously in what could be the world’s largest initial public offering, beating Saudi Aramco’s record $29.4 billion in December.
“Since the deal has not yet been announced, the company plans to seek approval from the Hong Kong Stock Exchange on Monday” said a source, who asked not to be identified. Ant, supported by the e-commerce giant Alibaba, refused to comment on the news.
Refinitiv magazine reported the approval news from the China Securities Regulatory Commission earlier on Monday. The magazine also reported that the board will approve the initial public offering of Stars Market this week.
Ant Market plans to start the pre-marketing period this week before the official order opening next week, Refinitiv reported, saying “Ant shares are likely to start trading “a few days” after the November 3 US presidential election“.
Ant Market originally intended to meet on the Hong Kong stock exchange on September 24th and launch the IPO after the week-long Chinese National Day holiday that ended on October 8, sources told Reuters earlier.
Sources said last week that the board was investigating a potential conflict of interest in the planned listing, delaying approval.
The regulator was looking into the role of Alibaba, Ant’s main payment platform, as the only third-party channel for retail investors to buy five Chinese funds investing in the IPO.
Ant aims to sell 10% to 15% of the company’s expanded capital in an initial public offering, split evenly between Hong Kong and Shanghai. It does not plan to offer a base tranche in Hong Kong in anticipation of strong demand from institutional investors.