Beijing is launching an intensifying crackdown over how tech billionaire Jack Ma originally won approval for an initial public offering (IPO) in China, The Wall Street Journal reported on Tuesday, April 27, citing sources.
Chinese regulators are investigating state officials regarding how Ma got fast approvals last year for Ant Group’s proposed dual listing in Shanghai and Hong Kong, sources told the Journal.
The government’s investigation is targeting regulators who gave Ant’s IPO the green light in moving ahead with a public offering. Beijing is also looking into big state firms that would have reaped benefits from the public offering, according to the WSJ.
“What happened is deeply embarrassing for regulators because they should have more effectively coordinated before approving the IPO,” said Martin Chorzempa, a research fellow at the Peterson Institute for International Economics who specializes in China’s FinTech space, per WSJ.
“By not doing so, they were stuck in a lose-lose situation of either the last-minute pause or, worse, forcing massive losses on IPO investors by changing the regulatory stance post-IPO,” Chorzempa added.
The Chinese billionaire’s relationships with state officials are also being probed as part of the scrutiny, the sources told the news outlet.
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