The Goldman Sachs Group Inc. and Bank of America Corp. were left out of Hong Kong ‘s planned sale. Also of shares by Ant Group due to their previous work with competitors. Moreover, of its subsidiary Alibaba, as per sources who were aware of the case.
Bankers at Alibaba Group Holding Ltd, which holds a third of Ant, have been advised by senior executives that they would keep from creating transactions for their rivals if they want business from Jack Ma’s vast empire, the sources added.
Ant also announced proposals to go public in Hong Kong and Shanghai with deals that could surpass Saudi Aramco ‘s unprecedented $29 billion IPO.
Andy Mok, a senior researcher at the Center for China and Globalization in Beijing stated that “The duopoly issue is not unique to China. But the scale and scope of Alibaba and Tencent’s business operations create an excruciating dilemma for investment banks.”
“Alibaba and Tencent’s businesses are so big, you can risk being blocked out of a significant future revenue stream”. Andy Mok added.
Goldman Sachs Left With Bank Of America
Though bankers always have to be cautious to work for competing companies with their customers. Chinese clients are far more likely than their peers in the US or Europe to seek non-competing promises as a show of trust and to insure that important tactics will not end up in the hands of rivals.
Bob Dodds, once served as an investment banker at China International Capital. “Competition has intensified and Chinese issuers have acquired good negotiating strength.”
The Goldman Sachs and Bank of America ‘s latest collaboration with Alibaba rivals has included $7.7 billion in product transactions. But over the last two years to Tencent-backed Pinduoduo Inc. And JD.com Inc., helping both firms develop their war chests to take on their bigger competitors. Furthermore, in the highly competitive e-commerce market.
Ant has been battling strongly with Tencent’s WeChat Pay to preserve its supremacy of China’s $29 trillion mobile payment market.
Ant has already been offering digital payment systems to KFC Holding Co. And Marriott International Inc.’s local arms as it turns the Alipay platform into an electronic marketplace with anythin. From loans and transportation to grocery delivery services.
As per consultancy iResearch, Alipay’s share of mobile payments rose for three successive years. However, increasing to 55.1 per cent in the fourth quarter. Tencent has a market share of 38.9 per cent.
Ant appointed Citigroup Inc., JPMorgan Chase & Co., Morgan Stanley and CICC to head the Hong Kong IPO. However they did not named banks for the Shanghai part
The deal is estimated to generate more than $10 billion, which may be worth $200 billion for the company.
