China’s fintech company Ant Group on Saturday announced that its founder Jack Ma will no longer have control over the firm. According to the latest announcement, the company will give 10 individuals, including the founder, management, and employees, voting rights independently, removing Ma’s voting control. This comes amid a regulatory crackdown on the firm that was triggered after its mammoth stock market debut was canceled two years ago, reported Reuters.
Billionaire Jack Ma owned 10 per cent shares of Ant Group, which is an affiliate of Alibaba Group. The report says he exercised control over the company through related entities. An investment vehicle of Ma called Hangzhou Yunbo controlled two other entities that in turn owned a combined 50.5 per cent stake in Ant, the report said.
As per the latest update, Ant Group said that Ma and nine of its other major shareholders had agreed to no longer act in concert when exercising their voting rights, and would only vote independently. It added that the shareholders' economic interests in Ant will not change as a result of the adjustments.
According to Reuters, Ma’s share fell to 6.2 per cent after the latest changes by the Ant Group.
Ant also said it would add a fifth independent director to its board so that independent directors will comprise a majority of the company's board. "As a result, there will no longer be a situation where a direct or indirect shareholder will have sole or joint control over Ant Group," it said in its statement.
In 2020, Ant's $37 billion IPO, which would have been the world's largest, was canceled at the last minute. Subsequently, it led to a forced restructuring of the group. Jack Ma in October 2020 publicly criticised Chinese regulators. Since then, his business empire has been under regulatory scrutiny.
Ant Group has been focused on restructuring its business operations to appease regulators, according to a Bloomberg report. The report says that the firm ramped up the capital base for its consumer loan affiliate, and moved to build firewalls in an ecosystem that once allowed it to direct traffic from the payment platform Alipay.