(Bloomberg) -- Alibaba Group Holding Ltd. has agreed to subscribe to more than a fifth of Ant Group’s imminent initial public offering, propping up its part-owned fintech giant’s potentially $35 billion debut.Asia’s largest corporation will buy 730 million of about 1.67 billion Shanghai-listed A shares as part of a placement to strategic investors, the e-commerce giant said in a stock exchange filing. Including the Hong Kong tranche of its IPO, Ant intends to sell a total of 3.3 billion shares. In addition, the financial services giant plans to issue about 1.16 billion Hong Kong-listed or H shares to Alibaba, part of a distribution of about 3.26 billion shares to existing backers.Alibaba co-founder Jack Ma’s Ant Group is racing toward what could be the world’s largest ever coming-out party, slated for sometime over the coming weeks. The IPO shares deal helps Alibaba prevent the dilution of its stake after Ant goes public. The Chinese e-commerce giant will hold about 32% of its affiliate’s shares after the IPO, based on data compiled by Bloomberg.Ant’s IPO is said to have drawn interest from strategic investors including Singapore’s sovereign wealth fund GIC Pte, Temasek Holdings Pte and China’s $318 billion National Council for Social Security Fund. That strong demand means the Alipay operator could fetch a valuation of at least $280 billion, despite concern that people within the Trump administration are exploring restrictions on the Chinese fintech giant, according to people familiar with the matter. Ant reported a 74% jump in gross profit to 69.5 billion yuan ($10.4 billion) from January to September, according to an A-share prospectus posted to the Shanghai exchange.Read more: Jack Ma’s Ant Group Raises IPO Valuation Target to $280 Billion(Updates with detail on stakes in the third paragraph. A previous version of the story was corrected to reflect Temasek’s full name.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Jack Ma’s Ant Group Co. is asking buyers of what could be the world’s biggest-ever initial public offering to commit to the deal just days before the U.S. presidential election.The Chinese fintech giant will price the Shanghai portion of its dual listing on Oct. 27 and allow subscriptions on Oct. 29, it said in a prospectus published on Wednesday. The deadline for payments will be Nov. 2. Ant hasn’t yet spelled out dates for the Hong Kong leg of the IPO, but they’re expected to be similar.While the company’s share sale is among the most hotly anticipated deals in years, the timeline will leave investors in a potentially precarious position: locked in during a pivotal week for global markets. Shares will almost certainly start trading only after the U.S. vote on Nov. 3, an event that could have big ramifications for both Ant’s overseas expansion plans and investor risk-appetite generally.Ant won regulatory approval for its Shanghai listing on Wednesday, clearing the way for it to begin gauging investor demand for an IPO that could value the Hangzhou-based company at $280 billion or more. It’s planning to raise about $35 billion from the dual listing, surpassing Saudi Aramco’s record $29 billion sale last year, people familiar with the matter have said.An Ant representative declined to comment.The company will issue no more than 1.67 billion shares in China, equivalent to 5.5% of the total outstanding before the so-called greenshoe option, according to its prospectus on the Shanghai stock exchange. It will issue the same amount for its Hong Kong offering.Alibaba Group Holding Ltd., which was co-founded by Ma and currently owns about a third of Ant, has agreed to subscribe for 730 million of the company’s Shanghai shares, which will be listed under the ticker “688688,” according to the prospectus. Alibaba will hold about 32% of Ant shares after the IPO.Read more: Alibaba Will Buy a Fifth of Shares in Ant Group’s Mega IPOSingapore’s sovereign wealth fund GIC Pte, Temasek Holdings Pte and China’s $318 billion National Council for Social Security Fund are also planning to invest, people familiar with the matter said earlier this month.That strong demand means Ant may fetch a valuation equivalent to Bank of America Corp. and Goldman Sachs Group Inc. combined, despite concern that rising geopolitical risks could hamper the Chinese company’s international ambitions. Ant reported a 74% jump in gross profit to 69.5 billion yuan ($10.4 billion) from January to September, according to its prospectus.(Adds details on Alibaba stake in seventh paragraph. An earlier version of this story corrected the spelling of Temasek Holdings Pte.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
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