- Fidelity to cut
Group of Antsestimated estimate up to $ 144 billion from $ 300 billion, according to regulations.
- The decline in value came after China introduced regulatory measures against the fintech giant.
- Fidelity originally invested in Ant Group in June 2018 for an estimated $ 150 billion.
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China’s regulatory pressure on Ant Group in recent months has led Fidelity to cut the fintech giant’s estimated valuation in half, according to regulatory filings first published by The Wall Street Journal.
Fidelity’s estimated Ant Group valuation fell to $ 144 billion from $ 295 billion, according to the statement. Fidelity first invested in Ant Group in June 2018 for an estimated $ 150 billion. The estimated valuation is a sharp drop from last year’s expected IPO valuation of more than $ 310 billion.
Fidelity isn’t the only US financial manager to invest in Ant Group prior to its IPO. BlackRock and T. Rowe Price have also invested between $ 200 million and $ 500 million in the Ant Group. Ant Group owns Alipay, a mobile payment app that processed $ 17 trillion in payment transactions last year and is growing rapidly as it bundles a number of financial offerings into one app.
But China canceled Ant Group’s public debut days ahead of its proposed IPO in November after the billionaire founder criticized international financial rules.
Since then, Ant Group has been subject to heightened regulatory scrutiny as it competes with legacy financial institutions that have higher capital requirements. Ant Group said it will apply to become a financial holding company under the control of the People’s Bank of China to ease regulatory pressure.
Ant Group’s regulatory oversight has also extended to Jack Ma’s Alibaba, which was fined a record $ 2.8 billion fine last month in an antitrust investigation.
“Alibaba sincerely accepts the punishment,” the company said in a statement regarding the record fine.