Ant Financial’s $1.5B Pre-IPO Plans

It was widely reported in 2105 that Alibaba’s financial arm, Ant Financial, would go public in 2016, but there wasn’t a set timeframe announced.

While that official timeline still hasn’t been relayed, its most recent funding round perhaps proves the company is getting closer to its IPO debut. Citing anonymous sources said to be close to the matter, Bloomberg reported Ant Financial is planning to raise $1.5 billion (10 billion yuan) in what would be its second fundraising round.

Sources also indicated that Zhejiang Ant Small & Micro Financial Services Group Co., which is largely controlled by Alibaba’s Founder Jack Ma, who will reportedly issue stock to new investors. Currently, what the reports indicate is that Ant Financial is seeking issuers and financial institutions, VCs and private equity funds in its latest investment round.

Ant Financial is known most for its Alipay online payment system, which has become a dominant force across China’s payments industry. Ant Financial also gained press during 2015 for taking on the traditional physical financial institution model with its Internet-based financial service. Ant Financial is a major investor in Tencent’s MYBank, an online-based lender.

Ant Financial’s entrance into the online banking industry pits Alibaba’s financial arm against its rival Tencent, which rolled out testing of China’s first online bank, WeBank, in January. As part of WeBank’s test run, the bank said employees of its stakeholders — which include Tencent, Shenzhen Baiyeyuan Investment and Shenzhen Liye Group — were able to open accounts, deposit money and, in some cases, take out loans.

Ant Financial’s value is reportedly $45 billion, following its fist round of funding in June. While it may be prepping to sell shares in its public debut this year, there’s indication that the firm may go after another round of financing before making the leap.

In January of 2015, Ant Financial also rolled out its new credit-scoring service, Sesame Credit, which combines “big data” technology and customer behavior analytics to help make credit more available to millions of Chinese consumers. The company plans to use this service to help process loans for its MYBank customers, too.

Bloomberg was able to confirm Ant Financial’s funding round from a spokesperson, but was unable to secure the logistics on other details. But if the second funding round follows its first, the firm would be poised to sell some of its shares to investors; its first round resulted in the company selling a 12.4 percent stake.


New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020 

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.