Jul 07, 2023, 11:43 AM
U.S.-listed shares in Alibaba (NYSE:BABA) rose in premarket trading on Friday, boosted by a Reuters report that the Chinese government will slap a fine worth at least 8 billion yuan (roughly $1.1B) on Ant Group in the coming days.
The possible penalty - the biggest placed on a Chinese internet company since regulators fined ride-sharing app Didi Global (OTC:DIDIY) for $1.2B last year - would conclude a multi-year revamp of Ant that was initiated by the People's Bank of China following the scrapping of the fintech firm's planned $37B flotation in 2020.
The end of the overhaul could mean that Ant will be able to secure a financial holding company license and, potentially, bolster a revival of an initial public offering. Before the IPO was scuttled, some investors had valued Ant at over $300B.
Neither Ant nor the PBOC were immediately available to comment to Reuters.
Alibaba (HK:9988), which holds a one-third stake in Ant, also saw its stock close up 3.4% in Hong Kong trading. Meanwhile, the e-commerce giant's peers Baidu Inc (NASDAQ:BIDU), PDD Holdings Inc (NASDAQ:PDD), and JD.com Inc (NASDAQ:JD) saw their shares gain in U.S. premarket dealmaking.