In the autumn of 2020, ant group first pushed forward the IPO process at an astonishing speed and got the token of listing on the science and technology innovation board, with an estimated value of 2.1 trillion yuan. Then, on the eve of the listing on November 5, the tuyere suddenly changed and the IPO stopped abruptly.
The sharp contrast between the quick and the one night stop makes the unicorn company stand on the front line.
Ant group has an annual profit of over $2 billion, and it doesnt look short of money. One of the factors behind the choice of IPO Financing this year may be driven by investment shareholders. Zhang Xiaorong, President of the Institute of deep science and technology, told Caijing.
For those who are in a hurry (to promote the listing of ant group), some people may put leverage into it. If they dont go public, they cant realize it, and they have to pay the interest. An industry observer also told Caijing that these people are really ants, but they are in hot pot.
The IPO of ant group has been suspended. In addition to the new regulations on online loan issued by the regulatory authorities, it will have an important impact on the companys business and valuation. Some people in the industry believe that this may also involve the game between the shareholders of ant group and all parties, and the penetration fog existing in the huge shareholder group of ant group.
The original shareholders of ant group can be regarded as luxurious, which can be divided into three categories: the first is Ali family and their relatives and friends ; the second is domestic investment institutions with strong strength; the third is some top overseas investment institutions, such as Singapore Investment Company, Malaysia Treasury holdings, Temasek, etc Zhang Xiaorong said: the investment of these institutions often amounts to hundreds of millions.
In addition, ant groups shareholder background is more complex, and the final penetration problem behind its huge shareholder group is not clear. The financial professionals said.
In this regard, Liu Feng, chief economist of galaxy securities, once pointed out that the basic condition for the effective operation of financial markets requires information symmetry, but investors and financiers naturally have asymmetric information. Therefore, we need to improve laws and regulations to make information transparent.
When the realization of the original shareholders wealth is hindered, a large number of investors who participate in the subscription of ant groups strategic placement fund are struggling to redeem the funds within the validity period. Some investors indicated that they would resolutely redeem the funds, while others realized that the profit of the strategic placement fund depended on how 90% of the fund was invested, rather than 10% of the ant group.
After the IPO was stopped, the probability of ant group to restart IPO in the short term became smaller, and the exit of original shareholders was delayed. Many financial people interviewed by Caijing said that in the short term, it is difficult to restart the IPO of ant group. At present, it is difficult to judge how long it will take for ant group to restart its IPO.
A few days ago, Fang Xinghai, vice chairman of China Securities Regulatory Commission, said that when ant group will be listed depends on how the government reorganizes the regulatory framework for financial technology enterprises, and also on how the enterprises respond to changes in the regulatory environment.
A senior person in the securities industry told Caijing that if you are a value investor, you dont have to worry about when ant group will be listed.
Prelude to the banquet of 2.1 trillion Wealth: luxurious shareholder lineup
In March 2012, Peng Lei was appointed CEO of Alibaba micro financial services. In October 2014, the company was named ant financial services group. At that time, the little ant of Ali Group officially appeared on the stage.
Six years later, the little ant grew into an elephant, an ant group valued at $200 billion.
Since then, its listing process has been rapidly promoted. On August 25, the Shanghai stock exchange accepted its IPO application, and on September 18, ant group launched its IPO and successfully passed the meeting. From submitting IPO application to successfully passing the meeting, ant group only took 25 days, and the speed of its sprint to the IPO of Kechuang board set a record.
On the evening of October 26, 2020, ant group announced the pricing, and the issuing price of a shares was determined to be 68.8 yuan per share, and that of Hong Kong was determined to be HK $80.00 per share, which means that its total market value is as high as 2.1 trillion yuan.
What is the market value of 2.1 trillion yuan?
Taking the A-share market as an example, when ant group announced its pricing, the listed company with the highest market value in the A-share market was Guizhou Maotai (600519. SH), with a total market value of 2.06 trillion yuan. This means that if it can be listed successfully, ant group is expected to surpass Guizhou Maotai and become the first share in the market value of a shares.
Its rapid growth can be seen from the changes in its valuation over the past few years. In 2015, ant group had a round of financing, and its post investment valuation was about 260 billion yuan. Just five years later, its valuation has almost jumped 8 times to 2.1 trillion yuan.
In the novel coronavirus pneumonia, the first three quarters of 2020 were even more alarming: the ant group realized a business income of 118 billion 191 million yuan in January and September, up 42.56% from the same period last year, mainly from the growth of digital financial technology platform revenue, and realized gross profit of 69 billion 549 million yuan, an increase of 74.28%; the gross gross profit margin increased from 48.13% in the same period last year to 58.84%.
Although ant group passed the meeting quickly and set the worlds largest IPO fund-raising record, and its profitability was not general, in Liu Fengs view, the timing of its listing was not a good time. Novel coronavirus pneumonia is catching up with the US general election, this years new crown pneumonia epidemic and some local debt crisis.
Many industry insiders interviewed by Caijing think that the reason why ant group chose to rush for IPO this year may be driven by the original shareholders behind it.
As for the novel coronavirus pneumonias rush to reallocate this year, Zhang Xiaorong believes that it may come from three aspects: first, the restriction of the US dollar outflow, which makes some foreign shareholders of the ant group hope to cash in as soon as possible; two is affected by the new crown pneumonia epidemic, some shareholders are pessimistic about the future economic development expectation, hoping to bag the security before the cold winter comes, and three is to go out. He is worried about Sino US relations. Previously, foreign media reported that the US government under trump had considered listing ant group in the trade blacklist. If this measure is implemented, it will affect the valuation of ant group when it is listed.
When it comes to the original shareholders of ant group before listing, its lineup can be described as luxurious, including national social security fund, China Post Group and other national teams, insurance funds such as China Life Insurance and Xinhua life insurance, as well as business tycoons such as Liu Yonghao, Shi Yuzhu and Wang Zhongjun, and many shareholders have not penetrated into the underlying private equity funds.
Ant groups shareholders, there may be more unknown big man. For example, some private equity funds, whose equity penetration is relatively difficult, said the financial professionals to Caijing
According to the prospectus disclosed by ant group, its shares are relatively concentrated, and the top ten shareholders hold 93.36% of the shares in total.
Among them, Hangzhou Alibaba network technology company holds 32.64%, which is the largest shareholder. Ali is a senior management and internal employee shareholding platform. Hangzhou Junhan equity investment enterprise (hereinafter referred to as Hangzhou Junhan) and Hangzhou junao equity investment enterprise (hereinafter referred to as Hangzhou junao) hold 29.8% and 20.65% respectively, which are the second and third largest shareholders of the company. Thus, Alibaba and its members hold about 83% of the shares of ant group. In addition, among the top ten shareholders, there are national social security fund, China Life Insurance, Zhifu (Shanghai) investment center, etc.
According to the reporter of Finance and economics, the current equity structure of Hangzhou Junhan and Hangzhou junao is a transitional structure, which will eventually transform into 40% of all employees including management and 60% of shares of strategic investors including Ali.
At present, Ma Yun is the actual controller of ant group. In reply to the Shanghai Stock Exchanges inquiry letter, ant group disclosed that Ma Yun indirectly controlled 50.5% of the companys shares through Hangzhou Junhan and Hangzhou junao, which are the actual controllers of the company. According to the relevant articles of association and agreement, Jing Xiandong, Hu Xiaoming and Jiang Fang are the persons acting in concert of Ma Yun on matters related to the resolutions of the shareholders meeting of Hangzhou yunplatinum.
In addition to the companys executives and employees, after several rounds of financing, ant group has a large number of investors. In addition to the social security fund and China Life Insurance mentioned above, it also includes CIC, CICC Jiazi, CDB finance and CCB trust. In 2018, the group also attracted a large number of investment funds from overseas, such as China Light Group, Malaysia National Treasury group, and the Malaysian state-owned pension group.
However, on November 5, the scheduled listing day, ant shareholders failed to wait for the bell to ring. On the evening of November 3, the Shanghai Stock Exchange announced that ant groups listing on the science and technology innovation board was suspended. Subsequently, ant group announced on the Hong Kong stock exchange that the listing of H shares was suspended. This wealth feast was drawn to a halt.
Strategic placement fund: from hot sale to class B exit
Ant group IPO derived from another drama, is the five innovative future strategic placement funds. One yuan can be ant shareholder, star manager management Rare themes, star fund managers and all-round publicity have jointly achieved this grand event of fund circle and become a rare opportunity for public funds to break the circle.
Late in the night of September 22, five companies issued a prospectus together. At the same time, the official of the prospectus of ant group announced that the five funds will participate in the strategic placement of ant group together with the strategic placement fund previously established.
In the next few days, the fund advertisements were broadcast in the subway, bus station and building elevator in major cities. You can see advertisements everywhere. It feels like the double 11 has been ahead of schedule. One investor recalled.
In the early morning of September 25, five funds were put on sale. A group of sales data with strong e-commerce color is: it will sell 1 billion yuan in 2 minutes. In just one hour, the five funds sold 10.2 billion yuan. E-fund innovation, which ranked first in the future, will take the lead in reaching the sales quota of RMB 12 billion, and will close the issue ahead of schedule, sold out in one day.
Its national day, and its going to cover the entire holiday season. The five ant strategic placement fund opened 118 live broadcasting projects in Alipay for the new development fund roadshow. It accumulated over 70 million people, and took turns to answer questions for investors during the holidays. The national day of Huaxia Fund was broadcast continuously for 8 days, with 4 hours of live broadcast every day, while huitianfu fund broadcast for 11 hours continuously on September 25. The fund manager also visited the live broadcasting room in person, setting a record for the longest live broadcast of financial management in a single session.
On the evening of October 8, all five innovation future funds were raised. According to relevant statistics, more than 10 million people have subscribed to the five funds, equivalent to 8 people buying every second. According to the total scale of 60 billion yuan, the funds per capita investment is only 6000 yuan, becoming the most inclusive new fund in history.
Most fund investors are looking for ants. If you dont buy ant stock, the product will lose its core value. If the product has deteriorated, it should be returned. Some investors have said so.
Industry insiders have commented that looking back on the previous announcements of ant group and five funds, the label of participating in ant battle allocation only accounts for 10% of the actual portfolio, which is equivalent to using ant IPO to leverage investors expectations. With 10% of the position to pry a national high-risk investment feast, but also buried the expected failure after the hidden danger.
As high as investors expectations are, so are losses. According to the Caijing reporters sample survey of relevant fund investors (the sample number is more than 100), more than 70% of the funders think that the money should be refunded, and about 20% of the funders think that at least the purchase and redemption should be opened.
On the evening of November 5, the China Securities Regulatory Commission (CSRC) made a statement on this issue. Subsequently, e-fund, Penghua, China Central Europe, huitianfu and Huaxia announced the optimization plan: to apply for listing on the stock exchange to facilitate investors to sell on the spot.
It is difficult for investors to be satisfied with the plan of listing and transferring. Market participants believe that the business of custody transfer is strange and complex, which is too difficult for new fund investors to enter the market, and there is a high probability of discount after listing. Some public funders also said that at present, it can only be considered as a compromise scheme, and it is uncertain whether the redemption will be opened in the future.
Late in the night of November 10, five companies successively issued announcements and launched new plans. The new scheme adds class B shares, and investors can withdraw according to the net value of fund shares. At the same time, the five innovation future funds still apply for share listing and trading according to the statement on November 5.
After dropping expectations of participating in the ant battle, investors began to re-examine the five funds. Whether to go or not to stay, opinions began to diverge. Finance and economics reporter learned that some investors will resolutely redeem, believe the fund managers words, it is better to buy open-end funds directly, there is no need to close for a year and a half.. Others want to arbitrage, buy it back after redemption, and you can earn the difference (because the secondary market is probably at a discount). More people are beginning to realize that making money or not depends on 90%, not the 10% of the propaganda.
At present, the five funds have started to build positions. As there is a one month exit option period from November 23 to December 22, positions should be controlled to cope with the pressure of redemption. An analysis of fund practitioners.
Behind the suspension of listing: wealth of all parties temporarily failed
After the suspension of listing, the focus of the market is: can ant group still be listed? Do the shareholders of ant group have any chance to cash in the capital market?
Many interviewees told Caijing that behind the IPO and suspension of listing of ant group, there is a big game between shareholders and all parties involved.
The ultimate equity penetration map may not be made public, but regulators need to master this information, the financial professionals told Caijing According to the current technology, equity penetration is complex, but not impossible to implement. From the experience of overseas mature markets, equity penetration is relatively clear, but in our country, there are still many ways to go. In its view, in recent years, a large number of reduction and Realization of the company after listing is one of the reasons that affect the companys difficulty in becoming bigger and stronger and the growth of Chinas capital market.
As the huge IPO project with a market value of 2.1 trillion was suspended, the dream of wealth expected by the original shareholders and employees of ant group was temporarily stranded.
According to the public information of ant group, from 2015 to 2018, the company conducted several financing.
The round a financing took place from June to August 2015. At that time, 12 investors, including the National Council of social security fund, Shanghai Zhongfu equity investment management center, Beijing China Post investment center, China Life Insurance, China Pacific Life Insurance, Xinhua Life Insurance and Chunhua capital, participated in the financing of ant group. These shareholders contributed 19.2 billion yuan in total. After the completion of the financing, the companys post investment valuation is about 260 billion yuan.
In May 2016, ant group conducted round B financing. At that time, 16 investors, including Zhifu (Shanghai) investment center, China Life Insurance, Shanghai Qihong investment center and China Gold Jiazi, participated in the round of financing, with a total investment of 29.1 billion yuan. After the completion of the financing, ants post investment valuation is about 390 billion yuan.
In 2018, ant group conducted two rounds of financing at home and abroad. Overseas, ant international has introduced 45 overseas investment institutions including Temasek. Ant international has issued 1.838 billion shares to these institutions with a transaction consideration of 10.3 billion US dollars. In China, it raised 21.8 billion yuan from Beijing innovation and growth enterprise management company, China Pacific Life Insurance, China Life Insurance, Beijing qianshun investment company, etc., and the post investment valuation rose to 960 billion yuan, equivalent to about 150 billion US dollars.
According to the investment of round a investors and the final valuation of ant group, if ant group can be listed successfully this time, the investment income of round a investors is expected to reach 10 times in five years, from 19.2 billion yuan to 192 billion yuan.
For those employees who expect to rely on equity incentives to gain value-added assets, millions of wealth has been temporarily destroyed.
Assuming that all the shares are granted to the current 16600 employees of ant group, each of them can get 5.4 million yuan. For executives with larger holdings, the losses are much higher than the average.
On the eve of the listing, investors in the last round of trading may be the least disappointed group among ant group shareholders.
The next day, ant group announced that the applied share proceeds (together with 1.0% brokerage commission, 0.0027% SFC transaction levy and 0.005% Hong Kong stock exchange transaction fee) for the Hong Kong public offering will be returned in two batches without interest.
On the evening of November 5, ant group announced that the issuer and the joint lead underwriters will return the investors according to the subscription funds of new shares paid by investors and the corresponding brokerage commission for new shares placement (if any), plus the bank deposit interest for the same period. The issuer and the joint lead underwriters will start the refund procedure on November 6, 2020, and the relevant funds will be returned on November 9, 2020. The shares subscribed by investors will be cancelled on November 6, 2020.
Investors who won the lottery have different reactions to this. Some investors said that Daxin ant group paid 34400 yuan in the first lot, which is expected to double after listing. Compared with the current refund, this expectation is a little big. However, some investors are more happy: ant groups listed share price performance may not be as expected after encountering supervision. If it breaks after listing, the loss will be greater.
As for the exit of the original shareholders, a senior securities industry personage told Caijing, if you are a value investor, you dont have to worry about when ant group will be listed. There is a valuation method, if the company can not be listed, do you buy it? If you dont buy it, its not a value investment.