Chinese mutual funds to unfreeze US$9 billion of investor capital after Ant Group’s IPO suspension

Name: What is Jack Ma’s Ant Group and how does it make money?
Uploaded: 2020-11-11T08:00:25.000Z
Duration: 3 min 4 s
Description: What is Jack Ma’s Ant Group and how does it make money?

Individual investors will have the option to pull some of the US$9 billion from mutual funds after the suspension of Ant’s stock offering

Mutual funds pooled 60 billion yuan from investors, allowing small investors to overcome the 500,000 yuan minimum threshold to invest on Star Market

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A woman walks past an Alipay advertising hoarding in a subway in Beijing. Photo: AFP

Zhang Shidongin Shanghai

Published: 4:00pm, 11 Nov 2020Updated: 4:00pm, 11 Nov 2020

Five Chinese mutual funds that bought into Ant Group shares will allow investors to pull their money out under a redemption programme after the Chinese government scuttled the fintech giant’s record-breaking initial public offering.

China Universal Asset Management, E Fund Management and three others will allow their fund subscribers the option to retrieve their money within a month starting from November 23, according to statements posted on their websites.

The money managers collected 60 billion yuan (US$8.9 billion) from the sale of fund units to investors ahead of Ant’s IPO. The plan allowed small investors to pool their money for a shot at the expected windfall, helping many of them to overcome the minimum 500,000 yuan needed to invest in Shanghai’s Star Market.

Ant’s US$39.67 billion IPO attracted a combined US$3 trillion from retail investors in Shanghai and Hong Kong, before it was unexpectedly halted on November 3 some 48 hours before its debut. Ant refunded investors immediately thereafter.

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What is Jack Ma’s Ant Group and how does it make money?

China on November 10 unveiled a new guideline to target monopolistic practices of its tech giants like Alibaba Group Holding, Tencent Holdings and Meituan, wiping some US$200 billion in market value over two days. Ant operates China’s largest online payment platform Alipay. Alibaba, the owner of this newspaper, owns one-third of the fintech.