Why Jack Ma’s Ant Group chose a dual IPO in Hong Kong and Shanghai and not New York

Ant’s dual IPO will be one of the largest share sales of all time if favourable market conditions prevail

The world’s most valuable unicorn has hired CICC, Citigroup, JP Morgan and Morgan Stanley for advice, sources say

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An employee works at a reception counter in the lobby of the Ant Group headquarters in Hangzhou, China. Photo: Bloomberg

Published: 6:31pm, 21 Jul 2020Updated: 5:48pm, 27 Sep 2020

As financial technology giant Ant Group gears up for one of the largest initial public offerings of all time, New York’s stock exchange is being left out in the cold.

The decision is a rare occasion where a marquee Chinese company has bypassed the world’s largest financial market entirely. Even Tencent Holding, its closest domestic competitor, conducted investor roadshows in the US before plumbing for a Hong Kong listing in 2004.

Ant’s choice of Shanghai and Hong Kong illustrates a shift in the balance of financial power eastward as more of China’s leading technology companies raise capital in markets closer to their users, creating a positive feedback loop of deeper secondary trading that attracts still more companies.

Hong Kong and Shanghai’s Nasdaq-like Star Market are innovating rapidly to keep this momentum going. Hong Kong this week unveiled plans for a technology index for investors to track fast-growing technology start-ups and behemoths, after the recent “homecoming” of Alibaba Group Holding, JD.com and NetEase, among others.

The restyling of Hong Kong and Shanghai confirmed the operator of Alipay e-commerce payments system long-held preference for local listings, people familiar with its thinking said. That leaning was conveyed to investors in June 2018, when it completed a Series C fundraising that valued the group at US$150 billion.