Exclusive-Beijing Gives Initial Nod To Reviving Ant IPO Plans In Shanghai, Hong Kong-sources

China's central leadership has given a tentative green light to Jack Ma's Ant Group to revive its initial public offering in Shanghai and Hong Kong, two sources with knowledge of the matter told Reuters on Thursday.

Ant, an affiliate of Chinese e-commerce behemoth Alibaba Group Holding Ltd, aims to file the preliminary prospectus for the offering as soon as next month, said the sources, declining to be named due to the sensitivity of the matter.

The fintech giant, however, still needs to wait for guidance from China Securities Regulatory Commission (CSRC) on the specific timing of the prospectus filing, said one of the sources.

In a publicly released statement, Ant said there was no plan to relaunch its IPO, which was hastily shelved at the behest of Beijing in November 2020. At the time, it was slated to be valued at around $315 billion and planned to raise $37 billion, a world record.

"Under the guidance of regulators, we are focused on steadily moving forward with our rectification work and do not have any plan to initiate an IPO," Ant said.

Neither the CSRC nor China's State Council Information Office, which handles media queries for central leaders, immediately responded to Reuters' request for comment.

Chinese authorities pulled the plug on the IPO and cracked down on Ma's business empire after he gave a speech in Shanghai in October 2020 accusing financial watchdogs of stifling innovation.

The IPO's derailment marked the start of a regulatory crackdown to rein in China's huge homegrown technology sector and the possible revival of a share sale would be a clear sign of a thaw in relations.

Bloomberg reported earlier on Thursday that Chinese financial regulators had started early stage talks on a potential revival of the stock market debut. It did not mention the possible listing venues or the timeline.

The regulator had established a team to reassess the share sale plans of the fintech giant, which is controlled by Ma, Bloomberg reported.

The CSRC said in a statement it had not conducted any assessment or research work regarding an Ant IPO.

The U.S. listed shares of Alibaba Group Holdings, which owns nearly one-third of Ant, were down 1% after earlier rising as much as 7% in pre-market trading on the Bloomberg report.

"The Chinese government needs something to encourage economic growth and there has been an easing in some regulatory policies that had been put in place for the tech sector," said Dickie Wong, executive director of Kingston Securities in Hong Kong.

"The size of Ant and the IPO will have to be smaller than what was planned in 2020 because the market conditions have changed and cannot be compared to now."

U.S.-listed shares of Chinese tech and e-commerce firms have gained this week on hints Beijing's months-long crackdown may be easing, with both ride-hailing firm Didi Global and Alibaba up by a third each.