Bloomberg News reported on Wednesday that the Chinese Communist Party’s anti-corruption watchdog was one of the institutions involved in a recent investigation into relationships between billionaire Jack Ma’s Ant Group (688688.SS) and state-owned Chinese enterprises.
According to the newspaper, which cited people familiar with the situation, the Central Commission for Discipline Inspection (CCDI) was looking into Ma’s fintech empire’s impact and the scope of its dealings with state banks and firms.
Ant did not respond to a request for comment from Reuters immediately, while CCDI could not be reached.
Ant, a subsidiary of e-commerce behemoth Alibaba Group (9988.HK), has been restructured by China, delaying its $37 billion initial public offering scheduled for late 2020.
According to Bloomberg, as part of its probe into former Communist Party Secretary of Hangzhou’s technology hub, Zhou Jiangyong, who was eventually ousted from the party, the anti-corruption agency issued enquiries to state enterprises in February regarding their exposure to Ant.
Ant Group, formerly known as Ant Financial and Alipay, is a subsidiary of Alibaba Group in China. Alipay, China’s largest digital payment network, is owned by the group and services over one billion users and 80 million merchants, with total payment volume (TPV) expected to surpass CN118 trillion in June 2020. The Wall Street Journal claimed in March 2019 that Ant’s flagship Tianhong Yu’e Bao money-market fund was the world’s largest, with over 588 million users contributing cash, accounting for more than a third of China’s population.
Ant Group was planned to raise US$34.5 billion in the world’s largest IPO at the time, valued at US$313 billion, in October 2020. China halted the IPO process on the eve of the public offering. Xi Jinping, the Chinese Communist Party’s head, is said to have personally cancelled the Ant IPO. [The Wall Street Journal reported on April 12, 2021, that Ant Group would be turned into a financial holding company regulated by China’s state-controlled central bank due to political pressure.
Ant Group has aimed to expand its services into Europe and the United States as a result of the growing number of Chinese tourists around the world. According to the company’s head of Europe division, the number of retailers accepting the Alipay app has tripled in Europe. Alipay has partnered with a number of European digital wallet apps, including ePassi (Finland), Vipps (Norway), MOMO (Spain), Pagaqui (Portugal), and Bluecode (Belgium) (Austria).
