Alibaba's Ant Group fires starting gun on dual listing in Hong Kong, Shanghai

By Julie Zhu

HONG KONG (Reuters) - Ant Group, the fintech arm of Chinese e-commerce giant Alibaba Group Holding <BABA.N>, said it has started the process of a dual listing in Hong Kong and on Shanghai's Nasdaq-style Star Market, kicking off one of the world's most hotly anticipated IPOs.

Ant is the world's most valuable tech "unicorn" - a startup valued at over $1 billion (794.2 million pounds). It would become the first company to list both in Hong Kong and on the Star Market and its IPO should boost the status of both Hong Kong and Shanghai as capital market centres.

The company, China's dominant mobile payments company, did not disclose the size, timetable or other details of the offering in its statement on Monday.

Reuters reported earlier this month that Ant was planning a Hong Kong float as soon as this year, targeting a valuation of more than $200 billion. It was valued at about $150 billion in its last funding round in 2018.

Ant, which was spun off from Alibaba in 2011, has long been preparing to step up plans for eventually going public in Hong Kong and mainland China. It has quietly brought back together many of its corporate finance team, some of whom had moved to other roles in recent years, Reuters reported in January.

"The innovative measures implemented by SSE STAR market and the SEHK (Stock Exchange of Hong Kong) have opened the doors for global investors to access leading edge technology companies from the most dynamic economies in the world and for those companies to have greater access to the capital markets," said Ant Group's executive chairman, Eric Jing.

China is gradually switching from its tightly-controlled IPO system where every float needs approval to a more registration-based scheme similar to the United States and other developed markets, which it piloted with the launch of Shanghai's tech-focused STAR Market last year.

In late March, the Shanghai Stock Exchange, operator of the STAR Market, said the board could now include fintech and technology services firms.

JD Digits, the fintech arm of e-tailer JD.com <9618.HK>, has also been preparing for going public on the STAR Market.

Hong Kong implemented listing reforms in 2018 that paved the way for tech firms with weighted voting rights and for early-stage biotechnology companies to list.

Companies raised nearly $7 billion via IPOs on the STAR Market in the first half of this year, making the bourse the second biggest market globally for IPOs, behind Nasdaq but ahead of Shanghai's main board and Hong Kong, according to Refinitiv data.

Ant offers loans, payments, insurance and asset management services via mobile apps.

However, in recent years it has emphasised its technology prowess amid increased regulatory scrutiny of financial risk. It won regulatory approval in May to change its legal name in Chinese to Ant Technology Group Co.

The company has been trying to expand beyond its financial services focus by allowing third-party vendors to offer services such as food delivery and hotel bookings on its Alipay mobile payment platform.

(Reporting by Julie Zhu; Additional reporting by Brenda Goh in Shanghai and Kane Wu in Hong Kong; editing by Jason Neely and Susan Fenton)