Jack Ma's Ant Group piles into fight with Citadel for Credit Suisse's Chinese business: report

By Louis Goss

Jack Ma's Ant Group has reportedly outbid Ken Griffin's Citadel Securities in the fight to acquire Credit Suisse's Chinese banking business, in a sign the Alipay owner now intends to revisit prior ambitions following an easing of Beijing's years'-long crackdown on tech companies.

If approved by regulators, Ant Group would buy Credit Suisse's Chinese investment banking venture from UBS (UBS) for an as yet undisclosed sum, with a view to building its own securities business using licenses initially granted to the Swiss bank, Bloomberg reported on Monday.

China's government would, however, prefer to see Credit Suisse's venture sold to a foreign buyer, in line with the aims of the original license which was awarded to the Swiss bank in order to open up the country's financial sector to foreign players, the report said, citing sources.

Seller UBS must now choose between the offer proposed by Miami-headquartered hedge fund Citadel that has a better chance of being approved, and Hangzhou-headquartered Ant Group's higher bid.

Citadel, which was started by U.S. billionaire Ken Griffin in 1990, has so far been the only foreign company to submit a bid for the Chinese venture having offered to pay around -Yen1.5- -Yen2 billion ($208- $277 million) for the business in December, sources said.

Ant Group's bid follows the end of a lengthy Beijing-led crackdown on China's tech sector, which was aimed at addressing alleged monopolistic practices inside the industry following years of fast-paced and unchecked growth.

The regulatory crackdown that wiped more than a trillion dollars off the value of China's top technology companies started with the quashing of Ant Group's initial public offering in November 2020, in a move that sent shockwaves through the global investment world.

The Chinese central bank and securities regulator's decision to impose a $985 million fine on the Hangzhou-headquartered financial services company in July 2023, is believed to have marked the end of that clampdown.

Ant Group, an affiliate of e-commerce giant Alibaba (BABA), previously had ambitions to start its own securities business prior to Beijing's tech crackdown.

Ant Group and Citadel were approached by MarketWatch for comment.

-Louis Goss

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02-26-24 0842ET

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