China’s Ant Group will increase its consumer lending arm’s capital by CNY 10.5 billion (USD 1.52 billion) as part of a restructuring effort aimed at reviving delayed plans for an initial public offering.
The Alibaba Group Holding-affiliated fintech company has gotten the green light from regulators to expand unit Chongqing Ant Consumer Finance’s capital base to CNY 18.5 billion (USD 2.7 billion). The company offers loans to users based on data from the Alipay mobile payment platform.
Under the expansion plan, Ant Group will remain the unit’s top shareholder, with a 50% stake, followed by a government-owned company in Hangzhou, where Ant is headquartered.
Outside investors have been brought on to improve transparency, including Hong Kong-based Nanyang Commercial Bank, top automotive battery supplier Contemporary Amperex Technology (CATL), and smartphone lens maker Sunny Optical.
Ant’s planned November 2020 mega-IPOs in Hong Kong and Shanghai were suspended after financial regulators took issue with its consumer credit and credit services and demanded an overhaul that would bring it under stricter oversight.
The consumer lending unit was spun off in 2021 as part of this restructuring. An earlier capital expansion plan fell through in January 2022 after investors abruptly pulled out.