China’s Ant Group, controlled by billionaire Jack Ma, is facing growing scrutiny for offering retail investors access to its $30bn share sale through an exclusive arrangement on its own mobile payments app.
Under the deal, investors bought exposure to the initial public offering — expected to be the world’s largest — through five funds that were exclusively allocated a portion of the company’s shares. Ant’s Alipay mobile phone application was the sole third party distributor of the funds.
“Is there a conflict of interest? Clearly there is,” said Peter Alexander, managing director at Z-Ben, a Shanghai-based consultancy, of Ant’s arrangement with the fund managers. “From an ethical standpoint you’re using your own platform to raise money from your clients to invest in your own company.”