The Shangai listing of Ant Group has been suspended two days before it was set to become the world’s biggest IPO.
Mobile payment specialist Ant, which is run by Chinese billionaire and Alibaba (NYSE:BABA) founder Jack Ma, was expected to be worth US$313bn on its market debut in Shanghai and Hong Kong.
Ma’s stake in the tech business was estimated to be worth US$17bn.
The Shanghai stock exchange said there were “major issues” following “changes in the financial technology regulatory environment”, the BBC reported, so Ant could not meet “listing conditions or information disclosure requirements”.
The Hong Kong exchange then announced Ant had decided not to go ahead with the listing.
“This is a curve ball that has been thrown at us… I don’t know what to say,” a banker working on the IPO told Reuters.
Ma, Ant’s executive chairman Eric Jing and chief executive Simon Hu were told by the regulators on Monday that they were facing tighter scrutiny by the government.
In fact, the Chinese authorities have recently published new rules for online micro-lending, since China is fearing rising defaults and lower asset quality amid the pandemic.
Last week, Ma said the Chinese financial regulation was outdated and not suited for fintech companies.
Ant was set to sell about 11% of shares, worth US$34.4bn, on its Thursday debut.
The sale would have been even bigger than than the US$29.4bn taken out of the market by Saudi Aramco a year ago.
Shares in Alibaba dropped 7% to US$288.37 after the market opened.