ANT Group, Alibaba Separation Plans Aim to Mitigate Crackdown Effects

Ant Group and Alibaba prepare to unwind some of their arrangements from each other and indeependently seek new business as the two companies try to ease the effects of China’s regulatory crackdown.

Ant Group was founded by the e-commerce giant Alibaba Group Holding as a payments and financial services provider in 2011. Alibaba still retains one third of ownership in the company and the two have some overlap in leadership.

The two companies have started to untangle some of their arrangements as they try to recover from China’s sweeping technology sector crackdown. The regulatory clampdown has caused market value loss in hundreds of billions of dollars for both, has shrunk their revenue and led to a record $2.8 billion fine for Alibaba.

The two affiliates have already started to compete with one another for clients, and started to restrict access to each other’s services.

Ant Group advertised its close ties with Alibaba as a major selling point during its record launch IPO launch of $37 billion before Beijing unexpectedly pull the plug on it in late 2020.

The company is now advertising its independence from Alibaba, especially in its overseas expansion. On the other hand, Alibaba is building a cross border transaction tool that could compete with Ant.

Alibaba has around 1.3 billion annual users across its marketplaces and generated over $1.3 trillion in gross merchandise value for the year through March. The company has several other services as well, including cloud services, video streaming and travel bookings.

The moves by Ant and Alibaba towards operational separation highlight China’s new business landscape, as Xi’s government wants to destroy concentration of power in the hands of private sector conglomerates.

Ant has been in the midst of a regulatory-driven transformation and it has been making progress in its bid to revive its IPO. China’s central bank had accepted Ant’s application to set up a financial holding company, a key step to completing its revival

Ant said on June 9 that there was no plan to relaunch the IPO and it’s currently focusing on “rectification” work.

Need to access the insight?

Start your 7-day free trial now

Need to access the insight?

Start your 7-day free trial now

Need to access the insight?

Start your 7-day free trial now


Do you need to access special insights on this matter?

Start your 7-day free trial  and become a member today


Subscribe to Top Insights Today

Subscribe to Executive Newsletter Top Insights Today

The Executive Newsletter -Top Insights Today- puts global business events in perspective through special insights

Join the ranks of global executives and subscribe to Top Insights Today

Top Insights Today covers insights on energy, clean-tech, oil&gas, mining, rare earths, defense, aviation, infrastructure, manufacturing, electrical vehicles, big-tech, finance and politics of business

By clicking subscribe you agree to our privacy and cookie policy and terms and conditions of use.

Read more insights

EU Imposes Tariffs on Chinese Steel Tower Imports

The European Union is set to impose tariffs on Chinese imports of steel towers used to produce wind turbines. The bloc concluded after an investigation that they were being sold at artificially low prices. The European Commission has imposed duties ranging from 7.2% to 19.2%.

Kenya Set to Elect a New Leader After 10 Years of Kenyatta Rule

Kenya is set hold elections on August 9 to choose a new president, parliament, county governors and assemblies. President Kenyatta will be stepping down after completing his constitutionally allowed 10 years. While many voters want change because of corruption and skyrocketing prices, both frontrunners have ties to Kenyatta. Among the two candidates, opposition leader Odinga has received Kenyatta’s endorsement, but Ruto has been his deputy president in the last decade before the two fell out.

U.S. Drilling Rights Auction Gets Interest From Oil Companies

Oil companies spent $191.7 million buying drilling rights in the Gulf of Mexico during a United States government auction. The industry seems hungry for more crude as the Biden Administration tries to move the U.S. away from fossil fuels. Industry interest was partly driven by the lower carbon crude from the Gulf of Mexico. 

Stay informed

error: This content is protected !!