The US government is exploring restrictions on Ant Group as well as Tencent over concerns that their digital payment platforms threaten US national security, Bloomberg reported on Wednesday citing people familiar with the matter.
Debate over how and whether to restrict Ant Group’s and Tencent’s payment systems has accelerated among senior US officials in recent weeks though a final decision isn’t imminent, the report said.
US officials are concerned that Ant Group and other Chinese fintech platforms will come to dominate global digital payments, the people said, adding senior officials discussed the idea in a September 30 meeting.
Yet officials acknowledge that it would be difficult to move forward until they sort out the mechanism, and that is proving difficult to do as the officials seek to find a legally sound approach.
The internal discussions come at a bad time for Ant, the online finance giant and owner of the Alipay e-payment system, as it nears a dual listing in Shanghai and Hong Kong, possibly by the end of the month.
An affiliate of Chinese tech giant Alibaba Group Holding Ltd., Ant is preparing for an IPO of about $35 billion that would give it an overall valuation of $250 billion, twice that of Citigroup Inc.
Ant Group said in a statement that it unaware of any administration discussions and that its “business is primarily in China and we are excited about our growth prospects in the China market.”
Ant Group, controlled by Alibaba founder Jack Ma, in August filed a listing prospectus with China's Nasdaq-style sci-tech innovation board, also known as the STAR market, and concurrently filed an A1 Application Proof with the Hong Kong Stock Exchange.
According to the prospectus, Ant Group's revenue for the first half of 2020 was RMB 72.528 billion, with a net profit of RMB 21.92 billion.
Ant Group intends to issue at least 10% of its total issued share capital in A-shares and H-shares in total, with a total issued share capital of at least 30,038.97 million shares, which means at least 3 billion new shares will be issued.