As the founder of Alibaba, Jack Ma was about to sell shares of Ant Group worth $37 billion on Thursday, making it the biggest stock market debut in the world the Chinese authorities suspended the listing at the eleventh-hour citing the reason due to major regulatory issues.
In the aftermath of the suspension, Alibaba saw a share price decline by 9.6 percent and 9.1 percent in Hong Kong and New York respectively. In 2014, Alibaba broke the record for the biggest stock debut in both the markets. The drop in share price erased nearly $76 billion off its value, twice the amount Jack Ma was planning to raise.
The Shanghai Stock Exchange in a statement said, “Mr Ma had been called in for supervisory interviews.”
Due to a change in the regulatory, Ant Group no longer meets the listing conditions or information disclosure requirements. As a consequence, it was decided to suspend Ant’s listing on the stock exchange.
The company was due to selling 11% of its shares at the price of $313 billion across the two stock exchanges. Last December, Saudi Aramco debuted with $29.4 billion, making it the largest listing in the world.
The firm’s executives along with Mr Ma were called in by Chinese authority for a discussion on regulating the sprawling fintech firm. However, the media reports are indicating that the meeting will address the comments made by Mr Ma at a fintech conference in October. In the conference, Mr Ma compared the merits of the digital banking system with the traditional “pawn shop.”
The company in a message to investors said, “Ant Group sincerely apologies to you for any inconvenience caused by this development. We will properly handle the follow-up matters in accordance with applicable regulations of the two stock exchanges.”
