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China's Ant ups fundraising target, valuation could hit $150 billion - sources

Reuters  |  HONG KONG/SINGAPORE 

By Julie and Anshuman Daga

HONG KONG/(Reuters) - China's Financial Services Group is in talks with investors to boost its fundraising target to at least $8 billion, which could see its valuation jumping to about $150 billion, people with knowledge of the plan said.

state investor is likely to be the lead investor in the latest round of equity raising by the company, controlled by founder Jack Ma, three people said.

reported in February that Ant, owner of China's top Alipay, was planning to raise up to $5 billion, which could value the firm at more than $100 billion.

The fundraising plan comes ahead of an expected stock market flotation, though has neither set a timetable for the initial public offering nor has it chosen any location for the same.

One of the people said could end up raising between $8 billion and $10 billion as a result of strong investor demand.

All the people spoke to on the condition that they not be named as the fundraising details were confidential. and Temasek declined to comment. Alibaba did not respond to a request for comment.

A pre-IPO round is an increasingly common move by sought-after Chinese companies to establish valuations and widen their investor base ahead of going public.

A $150 billion valuation would make one of the biggest public flotations ever, dwarfing this year's launch of and Dropbox. It would compare to the $104 billion float of six years ago or Alibaba's own $168 billion valuation in 2014.

Ant's last fundraising in April 2016 valued the company, seen by some analysts as one of the most valuable Alibaba assets due to its unique position in Chinese e-commerce, at about $60 billion.

Shares in giant Alibaba rose 4.3 percent in on Tuesday.

Alibaba said in February it was taking a 33 percent stake in Ant, replacing the previous system where it received 37.5 percent of Ant's pre-tax profit, in what was viewed as an important step ahead of any IPO.

"Part of the increase in valuation might be because the new investors have received extra features," said Jay Ritter, an IPO expert and at the

"But part of the increase is because the company is continuing to live up to expectations, and is becoming an even more in China's mobile payment space."

DUAL LISTING?

Temasek has expanded its tech investments in the last few years and recent deals include Chinese developer and Indonesian ride-hailing firm Go-Jek.

reported on Tuesday that was planning to raise $9 billion in its planned round of funding, potentially valuing the company at $150 billion.

The WSJ said it was expected to list on both domestic and overseas exchanges, in line with speculation that it would list in both Hong Kong and

Appetite among U.S. investors has been strong this year for tech sector debuts by Dropbox, and Zscaler, easing concerns raised by the fall in Snap Inc's shares last year.

Alibaba set up in 2004, modelling the business on PayPal, to help Chinese buyers shop online, and in 2011 controversially spun it off and rebranded the into Financial three years later.

After becoming a dominant payments company in China, Financial focused on international markets by buying a stake in Indian payment firm and Thai firm Ascend Money.

Its attempt to buy U.S. money transfer company was, however, blocked at the start of this year by U.S. officials on national security grounds, a blow to Ma who had promised that he would create 1 million U.S. jobs.

Current shareholders in include large state-owned institutions such as and Post Group, parent of

(Additional reporting by in Hong Kong and Parikshit Mishra in Bengaluru; Editing by and Edwina Gibbs)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

First Published: Wed, April 11 2018. 08:59 IST
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