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Demand to delay Ant IPO

written by Bella Palmer
ipo

The Hong Kong part of the initial public offering is being sponsored by CICC, Citigroup, and Morgan Stanley

Senator Marco Rubio, who has successfully urged the Trump administration to pursue investigations of Chinese companies, called on Friday for the U.S. government to consider options to delay an initial public offering for China's Ant Group, the fintech arm of Chinese e-commerce firm Alibaba.

It's outrageous that Wall Street is rewarding the Chinese Communist Party's blatant crackdown on Hong Kong's freedom and autonomy by orchestrating Ant Group's IPO on the Hong Kong and Shanghai stock exchanges, Rubio, a Republican, said in a statement to Reuters.

The Administration should take a serious look at the options available to delay Ant Group's IPO, he added.

The Hong Kong leg of the IPO is being sponsored by China International Capital Corp (CICC), Citigroup, JPMorgan, and Morgan Stanley. Credit Suisse is working as a joint global coordinator. Goldman Sachs is also involved.

It was not immediately clear how the U.S. government could postpone the listing of a Chinese company abroad. But Rubio's remarks are a sign of growing pressure among China hardliners in Congress, within the administration and elsewhere, for President Donald Trump to sanction Ant before it lists later this month.

Some fear the offering, worth up to £23.00 billion ($30 billion), could expose scores of U.S. investors to fraud. Others fear it could give the Chinese government access to sensitive banking data belonging to U.S. citizens.

These digital payment systems are the source of well-founded national security concerns, and the Trump administration should move to protect American users’ sensitive financial data as quickly as possible, Republican Congressman Jim Banks said in a statement when asked whether the administration should impose sanctions on the company.

Ant is China’s dominant mobile payments company, offering loans, payments, insurance and asset management services via mobile apps. Based in the eastern Chinese city of Hangzhou, Ant is 33% owned by Alibaba Group Holding Ltd and is controlled by Alibaba founder Jack Ma.

The company could become the latest victim of a years-long technology battle between Beijing and Washington that saw the Trump administration lash out at such Chinese companies as telecoms giant Huawei and surveillance camera maker Hikvision over everything from intellectual property theft, to breaches of sanctions and human rights abuses.

Rubio was the first to publicly call for a probe into popular Chinese-owned social media app TikTok by a powerful national security committee, which did review it. The administration ultimately banned the app, but a court-imposed injunction pending review has kept it from going into effect.

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