HONG KONG, April 28 (Reuters) – Ant Group, a subsidiary of China’s Alibaba Group, is acquiring a controlling stake in Bright Smart Securities & Commodities Group for $362 million. This marks Ant’s first venture into the securities brokerage business.
The deal, announced on Friday, will see Ant purchase a 50.55% stake in Bright Smart for HK$2.81 billion ($362.26 million). Bright Smart’s chairman, Yip Mow Lum, is selling 857.98 million shares to Ant Group’s Wealthiness and Prosperity Holding at a price of HK$3.28 per share. Following the acquisition, Ant will be obligated to make a mandatory cash offer for all remaining shares.
Bright Smart’s stock surged nearly 100% to a record high of HK$6 following news of the deal. It closed at HK$5.55 on Monday, an 82% increase from its last traded price of HK$3.05 before trading was halted on April 23. This marked the largest one-day percentage gain since Bright Smart’s listing in August 2010. In contrast, the Hang Seng Index remained flat on Monday.
According to the joint statement, Ant plans to maintain Bright Smart’s listing on the stock exchange.
Founded by billionaire Jack Ma, Ant Group is 33% owned by Alibaba and operates the popular mobile payment app, Alipay. The acquisition follows a significant refinancing in September, where Ant secured a $6.5 billion credit line, part of which is intended to expand its overseas operations.
This move comes after Chinese regulators halted Ant’s $37 billion IPO in 2020 and imposed a significant fine on the company following Ma’s controversial speech about financial regulation. Ant is currently working on securing a financial holding company license, which could pave the way for a future IPO.
($1 = 7.7578 Hong Kong dollars)
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