Ant Group is reportedly exploring options for the divestment of founder Jack Ma’s stake in a move that could potentially pave the way for a successful second listing attempt.

Jack Ma is under pressure to exit from the fintech giant, according to a «Reuters» report citing multiple unnamed sources, after months of discussion between China's most renowned entrepreneur and local regulators. 

Although Ma stepped down from corporate positions and owns only a 10 percent stake in Ant, according to its IPO prospectus, he exercises control through related entities. 

Most notable is Hangzhou Yunbo which controls two other entities with a combined ownership of 50.5 percent in Ant Group. Ma holds a 34 percent stake in Yunbo.

Full Exit

«Wall Street Journal» first reported that Ma had offered in November last year to hand over parts of Ant to the Chinese government. 

The latest report said that talks with officials from the central bank and the China Banking and Insurance Regulatory Commission continued from January to March this year with new Ma’s exit also discussed. 

Divestment Options

Although Ant Group had hoped that Ma’s stake could be sold to existing investors or its e-commerce affiliate Alibaba Group, Beijing, which retains the power to approve or reject such changes, would not allow ownership transferral to any familiar individual or entity. 

Instead, Ma will have to seek a full exit with the possibility of transferring his stake to a state-affiliated Chinese investor.

A spokesperson for Ant Group said the firm had never discussed nor considered divestment of Ma’s stake. 

Ownership Focus

After the infamous «pawn shop» speech triggered an IPO pullout in November last year and multiple months of Ma's disappearance from the public spotlight, Ant and Alibaba have yielded to a flurry of regulatory demands that resulted in wholesale restructuring and a record-high $2.8 billion antitrust fine issued against the latter entity. 

Although top officials such as the People’s Bank of China governor Yi Gang have previously said that following the «standard of legal structure» could lead to a revived IPO, the latest report underlines greater focus on ownership.

A separate report claims that part of Beijing’s motivation to block Ant’s listing included concerns about its beneficiaries which included renowned Chinese princelings.