Jack Ma’s fintech firm is set for IPO, signalling prospects for Nigerian fintech

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Ant Financial Services Group, the fintech subsidiary of Jack Ma’s Alibaba Group, is set for an Initial Public Offering (IPO) on both the Hong Kong Stock Exchange and Shanghai Stock Exchange’s STAR board.

The details

Announcing the development early Monday morning through a press statement that was published on its website, Ant Group said the concurrent IPO will “accelerate” its main goal of ensuring that China’s service industry eventually becomes digitised.

In the same vein, the IPO is also expected to help Ant Group to expand investments in technology and innovation, whilst partnering with investors to develop global markets.

Part of the press statement quoted Ant Group’s Executive Chairman, Eric Jing, to have said:

“The innovative measures implemented by SSE STAR market and the SEHK have opened the doors for global investors to access leading-edge technology companies from the most dynamic economies in the world and for those companies to have greater access to the capital markets. We are thrilled to have the opportunity to play a part in this development.

“Becoming a public company will enhance transparency to our stakeholders, including customers, business partners, employees, shareholders and regulators. Through our commitment to serving the under-served, we make it possible for the whole of society to share our growth.”

In October 2014, Alipay was restructured/rebranded in such a way that it became overseen by Ant Financial Services Group. The following year, the company (i.e., Ant Group) raised a whopping $4.5 billion during a funding round that was backed by the likes of China Development Bank Capital, Primavera Capital Group, and China Investment Corp, etc.

Since then, the company has made a number of acquisitions, including EyeVerify Inc which it bought in 2016. It has also successfully positioned itself as a major payment gateway in China’s e-commerce ecosystem, with Credit Suisse estimating that as much as 58% of the country’s massive online payment transactions go through the platform.

With this planned IPO, Ant Group will better position itself for greater exploits in the Chinese (and most likely) global fintech space.

This presents prospects for African and specifically Nigerian fintech.

Although relatively small when compared to Ant Group, Nigerian fintech firms are increasingly building capacity and positioning themselves as major players in the country’s financial services sector. Interestingly, these fintech firms are also quite good at raising capital.

In 2019 alone, African fintech was responsible for an estimated $2 billion in VC fundings. A bulk of those funds come into Nigeria, which has arguably become Africa’s fintech capital.

In view of the foregoing, therefore, perhaps an IPO is something Nigerian fintech may want to consider taking advantage of. This will not only benefit them but also present new investment opportunities for Nigerian investors who are constantly on the lookout for viable investment opportunities.

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