Chinese billionaire Jack Ma is on the brink of giving up control of payments company Ant Group, succumbing to years of intense pressure from Beijing.
Mr Ma’s decision to step back comes after a concerted effort by Xi Jinping’s administration to rein in his power. Mr Ma, 57, founded online retailer Alibaba and payments giant Ant, rising to prominence as one of China’s most successful entrepreneurs with an estimated fortune of $24bn (£19.8bn).
In recent years he became one of the highest-profile figures in a crackdown by Beijing on the country’s technology sector.
Ant Group was forced to pull out of a $200bn float in Hong Kong and Shanghai in November 2020 amid scrutiny from Chinese authorities.
A month earlier, Mr Ma had criticised the country’s financial regulation, attacking “outdated regulation”, a “pawn-shop mentality” and warning that “economic growth and innovation are threatened” by Beijing authorities.
The flamboyant billionaire, who was known to perform on stage at company parties dressed as Michael Jackson, was not seen in public for three months after the failed float, only reemerging at a low-key ceremony honouring China’s teachers.
Mr Ma has since kept a low profile amid Ant’s negotiations with state authorities over a “rectification” of the payment company’s operations.
Ant, whose Western investors include Warburg Pincus, General Atlantic and Silver Lake, has been forced into a drastic restructuring by state banks, selling stakes in the company’s divisions to Chinese government funds.
The Wall Street Journal first reported that Mr Ma would give up control of Ant. Shares in Alibaba, which has a major stake in Ant, fell 6pc on Friday.
Ant had been reviving plans for its blockbuster listing, but Mr Ma’s decision to hand over control of the company is expected to further delay its public debut. Chinese listing rules require at least a three year wait between a company changing its controlling shareholder and its listing on public markets, the Financial Times reported. In Hong Kong, the delay is a one-year wait.
In recent weeks, Mr Ma has been spotted touring Europe, visiting a restaurant in Austria, a university in the Netherlands and docking his yacht off the Spanish island of Mallorca, Bloomberg reported.
Alibaba, China’s answer to Amazon, was founded by Mr Ma in 1999. Its financial operations were spun out in 2011, which grew into Ant Group.
Ant is arguably China’s most successful financial technology company, with over one billion users of its all-in-one payments app. Its app allows customers to send payments, pay bills and invest in their savings, although it has faced pressure from China’s authorities to break up its products.
Chinese technology stocks have fallen amid a wider tech downturn and fears of overreach from Beijing. Shares in Alibaba are down around 20pc this year, while shares in gaming giant Tencent have fallen 29pc.
Beijing’s tech crackdown has included limits on the amount of time children can spend gaming and demands that ride-hailing company Didi pull out of its US listing.
Alibaba has faced billions of pounds in fines from Chinese authorities in a crackdown on allegedly monopolistic practices.