Ant Group has reached a deal with Chinese regulators to restructure its business after they raised issues that halted its $37 billion initial public offering last year, reported the Financial Times.
The proposed restructuring will involve Ant placing all of its major businesses, including its technology units, inside a financial holding company to comply with a new regime implemented by the People’s Bank of China in November.
The change, which is likely to be announced before the Chinese New Year holiday begins on February 11, according to two FT sources familiar with the process, will leave China’s largest mobile payments company subject to stricter capital requirements, making it more like a bank than a tech company.
A person close to the company, who declined to be named, said it would take several months to complete the overhaul. “Business will definitely be impacted,” he added. “The actual impact will depend on how strictly we follow the new online lending rule,” reported the FT.