SHANGHAI – Ant Group founder Jack Ma will no longer control the Chinese fintech giant after the firm's shareholders agreed to implement a series of adjustments that will see him give up most of his voting rights, the group said on Saturday.

The move marks another big development after a regulatory crackdown scuppered Ant's US$37 billion (S$49.4 billion) initial public offering (IPO) in late 2020 and led to a forced restructuring of the financial technology behemoth.

While Ma owns only a 10 per cent stake in Ant, an affiliate of e-commerce giant Alibaba Group Holding, he exercised control over the company through related entities, according to Ant's IPO prospectus filed with the exchanges in 2020.

Hangzhou Yunbo, an investment vehicle for Ma, had control over two other entities that own a combined 50.5 per cent stake of Ant, the prospectus showed.

Ant said that Ma and nine of its other major shareholders had agreed to no longer act in concert when exercising their voting rights, and would only vote independently.

Ma previously possessed more than 50 per cent of voting rights at Ant, but the changes will mean that his share falls to 6.2 per cent, according to Reuters calculations.

Ant also said it would add a fifth independent director to its board so that independent directors will comprise a majority of the company's board. It currently has eight board directors.

"As a result, there will no longer be a situation where a direct or indirect shareholder will have sole or joint control over Ant Group," it said in its statement.

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Reuters reported in April 2021 that Ant was exploring options for Ma to divest his stake in the group and give up control.

The Wall Street Journal reported in July last year, citing unnamed sources, that Ma could cede control by transferring some of his voting power to Ant officials including chief executive Eric Jing.

Ant's market listing in Hong Kong and Shanghai was derailed days after Ma publicly criticised regulators in a speech in October 2020. Since then, his sprawling empire has been under regulatory scrutiny and going through a restructuring.

Ant operates China's ubiquitous mobile payment app Alipay, the world's largest, which has more than one billion users.

Once outspoken, Ma has kept an extremely low public profile in the past two years as regulators reined in the country's tech giants and did away with a laissez-faire approach that drove breakneck growth.

"Jack Ma's departure from Ant Financial, a company he founded, shows the determination of the Chinese leadership to reduce the influence of large private investors," said Andrew Collier, managing director of Orient Capital Research.

"This trend will continue the erosion of the most productive parts of the Chinese economy."

As Chinese regulators frown on monopolies and unfair competition, Ant and Alibaba have been untangling their operations from each other and independently seeking new business, Reuters reported last year.

Ant said on Saturday that its management would no longer serve in Alibaba Partnership, a body that can nominate the majority of the e-commerce giant's board, affirming a change that started in the middle of last year.

Source: Reuters