According to the founder of the Chinese fintech giant Ant Group, Jack Ma, the huge dual listing of the company in China will turn out to be the largest ever in the world when calculated on the basis of a pricing determined on Friday night.
“It’s the first time that the pricing of such a big listing – the largest in human history – has been determined outside New York City” he told the Bund Summit in the eastern financial hub of Shanghai.
“We didn’t dare to think about it five years ago, or even three years ago. But a miracle just occurred,” he told the audience, which included officials from China’s regulators.
No details of the exact amount of the pricing were given by Ma since it is to be announced officially next week.
Ant is set to go public simultaneously in Hong Kong and on Shanghai’s STAR Market in the coming weeks. The company is also backed by Chinese e-commerce giant Alibaba.
Previous reports quoting sources have pegged the value of the listing at around $35 billion which would easily surpass the value of the record $29.4 billion listing of the Saudi Arabian oil giant Saudi Aramco in December last year.
Innovation in companies is stifled by the financial and regulatory system, Ma said and hence he called for undertaking a revamping of the system to extend financial services to more small companies and individuals with the help of technology which is the central ethos of Ma’s Ant Financial.
While describing the global regulatory and financial system, that was established after World War II as being out-dated and too risk-averse, he also said that the Basel Committee on Banking Supervision was “an old men’s club”. He also warned that riks are slowly piling up in the entire global economy.
He said that a strong “pawnshop” mentality is still dominant in the operations of banks in China as these banks demand collateral and guarantees prior to lending which is a model of banking that will not be able to support future growth.
Banks instead need to adopt and implement a new banking system that will be inclusive and universal and a system should be established that will be able to easily lend to small businesses as well as individuals basing their decisions on analysis of big data.
Big data primarily forms the basis of the decision and activities of Ant which is known for possessing an extensive payment and micro-lending business. But the company has in the past faced increasing scrutiny from regulators.
“Today’s financial system is the legacy of the Industrial Age,” Ma said. “We must set up a new one for the next generation and young people. We must reform the current system.”
(Adapted from LiveMint.com)