Fidelity Investments Trims Ant Group’s Valuation by Another 9%

UTC by Ibukun Ogundare · 2 min read
Fidelity Investments Trims Ant Group’s Valuation by Another 9%
Photo: Depositphotos

Apart from Fidelity, another investment management company Blackrock also lowered its estimates for Ant in 2022.

Financial services corporation Fidelity Investments has again cut Ant Group Co.’s valuation. According to Bloomberg calculations based on filings, Fidelity trimmed Ant Group’s valuation by 9% from the end of May to approximately $63.8 billion as of the end of November. This is down from $235 billion just before regulators halted Ant’s $37 billion initial public offering (IPO) in November 2020. Before now, Fidelity Investments reduced its estimate for Ant from $78 billion in June 2021 to $70 billion in May 2022. We are now in 2023, and filings show that the financial services provider had dropped its estimates once more to about $63.8 billion in November 2022.

Apart from Fidelity, another investment management company Blackrock (NYSE: BLK) also lowered its estimates for Ant in 2022. The asset manager dropped its estimate from $174 billion as of March to $151 billion. T.Rowe Price Group Inc also cut the value from $189 billion to $112 billion. Following the new valuation estimates last year, Bloomberg revealed Ant’s valuation range to be between $70 billion and $151 billion.

Over time, the Ant Group has been managing its operations to comply with the government’s demands. At the same time, the company is looking forward to receiving regulatory approval to apply for a license as a financial holdings company. This license is bound to support its continuity as a fintech service provider. Amid the approval wait, the government has permitted the company’s consumer lending unit to increase capital. This allows the consumer-finance arm to generate the equivalent of $1.5 billion in new capital. Ant Group owner Jack Ma also spoke about conceding the company’s control.

On the other hand, Ant has been facing setbacks in its operations. The company is struggling with regulatory crackdowns and managing to stay afloat in the deteriorating Chinese economy. Its affiliate company, Alibaba Group Holding Ltd, emphasized Ma’s vision of economic interest. Alibaba revealed that the Ant Group owner plans to reduce and limit his direct and indirect economic interest in Ant Group “over time.” The businessman intends to lower the economic interest to not more than 8.8%. Part of his plans is to own about 6.2% of voting rights after conceding control.

Currently, Ant Group has no plans for a public offering. The company’s spokesperson noted:

“Ant Group has been focusing on its business rectification and optimization, and does not have a plan for an IPO.”

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Ibukun Ogundare

Ibukun is a crypto/finance writer interested in passing relevant information, using non-complex words to reach all kinds of audience. Apart from writing, she likes to see movies, cook, and explore restaurants in the city of Lagos, where she resides.

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