Benzinga | Dec 31, 2020 03:43AM EST

Jack Ma's Ant Could Be Forced To Divest Chunk Of $21.6B Investment Portfolio: Reuters

Chinese regulators are considering asking Alibaba Group Holding Ltd. (NYSE:BABA)-backed financial technology giant Ant Group to divest some of its portfolio, according to a Reuters report Thursday.

What Happened: A dozen of the equity investments held by Ant are under review in China, as per Reuters.

The company, co-founded by Jack Ma, could be forced to divest its holdings -- primarily in technology and fintech companies -- on anticompetitive grounds.

Ant has stakes in Indian payments company Paytm and a Chinese state bank. According to Refinitiv, the fintech giant has 81 equity investments overall worth $21.6 billion.

The company is already reportedly seeking prospective buyers for about a dozen of its holdings, including bike-sharing company Hellobike.

Why It Matters: Such a move by Chinese authorities would be a major setback to Ant's dominant position in the Chinese fintech space.

The Ma-led company's plans for a $37 billion initial public offering -- which would have been the world's largest IPO ever -- were quashed by the Chinese government in November in the aftermath of the billionaire entrepreneur's comments at an event in Shanghai.

The People's Bank of China has also asked Ant to "rectify" how it conducts business, according to multiple reports.

See Also: Why China Slashed Jack Ma's Ant IPO Hopes, Experts Explain

Ma now trails CEOs of fellow Chinese companies Pinduoduo Inc. (NASDAQ:PDD) and Tencent Holdings Limited (OTC:TCEHY) in terms of wealth after the fall in Alibaba's stock price over the last two months.

Price Action: Alibaba shares closed 0.9% higher at $238.39 on Wednesday.

Photo courtesy: World Economic Forum via Wikimedia