Hong Kong exchange operator backs decision to halt Ant’s record IPO

Photo: HKEX website

Hong Kong stock exchange, which missed out on the chance to host Ant Group’s record $37 billion listing this month, believed the move to suspend the IPO was the right one and hoped the Chinese fintech giant would come back later, its CEO said on Wednesday.

Hong Kong Exchanges and Clearing (HKEX), which currently ranks fourth in the IPO league table of global exchanges according to Refinitiv, would have jumped to No. 2 if Ant‘s dual listing in Hong Kong and Shanghai had gone ahead.

The IPO was thwarted last week when the Shanghai Stock Exchange said it would halt the company’s STAR Market listing, prompting Ant to also freeze the Hong Kong leg of the deal.

The market “needed time to fully absorb regulatory changes,” Charles Li, chief executive of the Hong Kong bourse, said on an earnings call with the media.

Li did not specify which regulatory changes, but analysts have pointed to a consultation paper issued by the banking watchdogs recommending tightening rules for online micro-lending companies as foreshadowing the regulators’ move against Ant.

“When Ant is ready to come back, we stand ready to welcome them back to our market,” said Li, who steps down as CEO of the bourse at the end of this year.

HKEX, on Wednesday, reported a net profit of HK$3.45 billion ($445 million), a quarterly record, and a 52% rise from a year earlier, lifted by higher trading revenue and listing fees.

Trading volumes were boosted by a slew of large listings including by New York-listed firms like Netease and KFC China operator Yum China <9987.HK>, as well as record turnover on the stock and bond “connect” schemes.

The development of the “connects”, which links Hong Kong with the Shanghai and Shenzhen bourses, and reforms to allow secondary listings are among Li’s achievements during his 11-year tenure.

High on the agenda of Li’s successor would be MSCI A-share derivatives, “a long-anticipated missing piece”, said Dennis Lam an equities strategist at DBS.

Last year, global index publisher MSCI and HEKX said they would launch futures contracts on the MSCI China A Index, an onshore Chinese benchmark, to provide a hedging tool for international investors, but they have not yet launched.

Reuters

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.