By Colin Qian, Julie Zhu and Meg Shen
BEIJING/HONG KONG (Reuters) - China's Ant Group has won the final nod from the country's top securities watchdog for the registration of its Shanghai offering, the regulator said on Wednesday, clearing the last regulatory hurdle for its $35 billion dual-listing.
Ant, the fintech company backed by Chinese e-commerce group Alibaba Group Holding <BABA.N>, plans to list simultaneously in Hong Kong and Shanghai in the coming weeks, sources have said.
The listing could be the world's largest initial public offering, surpassing the record set by Saudi Aramco's $29.4 billion float last December. The IPO would also be the first simultaneous listing in Hong Kong and on the year-old STAR Market in Shanghai.
Ant is set to conduct price consultations for the Shanghai offering on Oct. 23 and will set the price on Oct. 26 as per its updated prospectus filed with the local exchange.
The fintech group aims to split the share offering evenly between Hong Kong and Shanghai, selling up to 1.67 billion on each exchange. That would represent up to 11% of its enlarged share capital, before a 15% greenshoe or over-allotment option is exercised, the prospectus showed.
Strategic investors whose investments in Ant's STAR IPO will be locked up for at least 12 months, will account for 80% of the domestic float. Among them are Zhejiang Tmall Technology, a wholly-owned unit of Alibaba, which has committed to purchasing 730 million shares, according to the prospectus.
The share sale plan comes after the China Securities Regulatory Commission accepted the registration of Ant's [IPO-ANTG.HK] domestic float on the Nasdaq-style STAR Market, as part of the local rules. The company filed its preliminary prospectus in late August.
Proceeds will be used partly to support Ant's digital economy business and to enhance its research and development capabilities.
Ant, China's biggest mobile payments company, reported an operating income of 118.2 billion yuan ($17.78 billion) in the nine-months to September, up 42.6% from year earlier, as per the prospectus.
Nine-month gross profit rose 74.3% to 69.5 billion yuan.
Hangzhou-based Ant on Monday also won approval from the Hong Kong Stock Exchange for the offshore leg of its IPO, Reuters has reported.
For the Hong Kong leg, Ant plans to start a brief pre-marketing period this week before opening order books next week. Its shares are likely to start trading a few days after the Nov. 3 U.S. presidential election, sources have said.
After receiving initial feedback from potential investors, Ant is looking to increase its offering size to $35 billion from up to $30 billion, targeting a valuation of about $250 billion or more, Reuters has reported.
If completed, Ant's IPO would significantly burnish Hong Kong's status as a capital markets hub, with $28.8 billion worth of IPOs and secondary listings between the start of this year and mid-October, Refinitiv data showed.
That helped Hong Kong to take the second spot in the global stock exchange league table - after Nasdaq - despite fallout from the coronavirus pandemic and anti-government protests.
Ant does not plan to offer a cornerstone tranche in Hong Kong in anticipation of strong demand from institutional investors, Reuters has reported.
(This story corrects paragraph 4 to say Ant will set the price on Oct 26, not Oct 27)
(Reporting by Colin Qian and Ryan Woo in Beijing, Julie Zhu and Meg Shen in Hong Kong; editing by Louise Heavens and Jane Merriman)