Skip to main content

Ant Group Creates Credit-Scoring Company with State Sponsors

The new company will be named Qiantang Credit Reporting. Ant will have a 35% ownership stake, China's central bank said.
  • Author:
  • Publish date:

Jack Ma’s Ant Group payments company is establishing a credit score company with state sponsors, the Peoples Bank of China announced Friday.

The move is part of an Ant restructuring ordered by Chinese authorities.

The new company will be named Qiantang Credit Reporting. Ant will have a 35% ownership stake, the central bank said, according to The Wall Street Journal.

Zhejiang Tourism Investment Group, which is controlled by the Zhejiang provincial government, also gets 35%. Two Ant executives will have a 10% stake, and the rest goes to Zhejiang-based companies.

The credit score company has a registered capital of 1 billion yuan (US$157 million), according to The Journal.

TheStreet Recommends

Ma, of course, is the founder of e-commerce titan Alibaba  (BABA) - Get Alibaba Group Holding Ltd. Report, which recently traded at $132.63, down 3%, and has plunged 43% year to date.

Morningstar analyst Chelsey Tam has mixed views on that company.

“Although we have slashed our fair value estimate for wide-moat Alibaba to $188 from $284 following a weak third quarter, we continue to believe the stock is undervalued and we retain confidence in its network effect,” she wrote last week.

“The company operates platforms with the largest number of merchants and has the highest gross merchandise value per user in China …

“However, we think Alibaba’s challenges go beyond the economic cycle. The company faces intense competition in the unprofitable and low end of the e-commerce market in China that it must enter in order to achieve its goal to be the omnichannel retail giant in China.

“This led to our fair value estimate decrease.”