Alibaba recently announced that it will acquire a 33% stake in Ant Financial through a Chinese subsidiary and will terminate the current profit sharing agreement with Ant Financial. Although everyone knows that in the relationship between the three, Alibaba and Ant Financial were both founded by Jack Ma. An announcement triggered a lot of discussion, and some people couldn't help but wonder: What is the relationship between Alibaba and Ant Financial?
Both are inseparable from one person - Jack Ma.
First of all, Jack Ma’s team first founded Alibaba. After years of hard work, and through investments from Japan’s richest man Masayoshi Son’s SoftBank, Yahoo of the United States and other international capitals, it gradually developed into the number one in China and the world’s number one. The leading e-commerce giant. Although Jack Ma’s team still controls Alibaba’s managers through a partnership system, the proportion of shares held by Jack Ma’s team is not high after all. The biggest beneficiaries of Alibaba’s profits are Masayoshi Son’s SoftBank, Yahoo! and other international capitals. Refer to the IPO structure of Alibaba in the early stage of listing in the United States: SoftBank Group holds 32.4%, Yahoo holds 16.3%, Jack Ma 7.8%, Tsai Chongxin 3.2%, etc.
Perhaps due to domestic payment security and regulatory considerations, in order to develop Alipay better, in 2009 and 2010, Jack Ma spent 330 million yuan on Alipay twice through operations. The business was spun off from Alibaba Group and put into Zhejiang Alibaba E-Commerce Co., Ltd., which owns 80% of the shares, focusing on developing Alipay in the domestic payment market. In October 2014, Zhejiang Alibaba E-commerce Co., Ltd. announced the establishment of Ant Financial as its main body, and introduced the National Social Security Fund, CDB Financial, China Life (601628), and National teams such as China Post Group, and Ant Financial have also gradually formed inclusive financial businesses that have far-reaching influence in the country, such as Alipay, Yu'E Bao, Zhima Credit, Jiebei, and Yongbei.
?The two currently have no shareholding relationship, but they have a profit relationship
So, the current Alibaba and Ant Financial actually have no shareholding relationship, but Jack Ma originally When Alipay was divested from Alibaba, an agreement was signed, which stipulated that Alipay would need to pay 49.9% of pre-tax net profits to Alibaba every year before going public. If Alipay goes public, it will also need to pay Alibaba Group 10% of the total market value at the time of listing. 37.5%, and stipulates that it shall not be less than US$2 billion and not exceed US$6 billion.
However, based on the development trend of Ant Financial in recent years, it is obvious that if it is listed, 37.5% of its market value will far exceed 6 billion US dollars, so Alibaba Group is not stupid. In 2014, it entered into cooperation with Ant Financial A new agreement was signed, stipulating that, subject to regulatory approval in the future, Ant Financial may issue an additional 33% of shares to Alibaba Group, and Alibaba Group will choose to subscribe. Now Alibaba Group is subscribing, which can be regarded as Jack Ma’s feedback. After all, without Alibaba’s letting go, Alipay and Ant Financial would not be as powerful as they are today.
Although Ant Financial has not yet launched an IPO, it has attracted competition for invitations from the United States, Hong Kong and A-shares. In April 2016, Ant Financial completed Series B financing, with a valuation of 60 billion at the time. U.S. dollars (equivalent to about 380 billion yuan), current valuations in the market estimate that if Ant Financial IPOs in 2018, its valuation will rise to 747.24 billion yuan, and if it IPOs in 2019, its valuation will further rise to 1,043.9 billion.