As Ant Group Co. founded by billionaire Jack Ma, grapples with Chinese government demands to overhaul its business, Simon Hu has unexpectedly resigned as CEO, adding fresh turmoil to the financial technology giant.
Who will be the new leader?
A person familiar with the matter said that Hu resigned for personal reasons, also stepping down from his role as an executive director on the company’s board. The person wanted to remain anonymous because the information isn’t public. He also said that Ant’s current chairman, Eric Jing, will become CEO effective immediately. A spokesperson for Ant confirmed Hu’s resignation.
Hu as a leader
Hu was known for rolling out innovations such as using data analytics to offer collateral-free financing services to small businesses while working at China Construction Bank. He started working at Alibaba in 2005 and helped Alibaba beat Amazon.com Inc. to build Asia’s largest cloud business.
In 2018 he became the president of Ant Group and CEO in December 2019. He focused on charitable work at Ant and Alibaba going forward. Alibaba owns about a third of Ant.
“Simon’s joining and departure at Ant were both closely related to the IPO,” said Michael Norris, a research and strategy manager at Shanghai-based consultancy AgencyChina. “His leaving casts a cloud on the timeline of the listing.”
New rules and new strategies
As China takes aim at the push of technology firms into finance, billionaire Ma’s financial juggernaut has been at the center of a crackdown. Hence, Ant, along with many others, has to cope with many new rules which aim at curbing their influence in everything, from digital payments to online lending and credit scoring.
People familiar with the matter have said, Ant and Chinese regulators have agreed on a restructuring plan that will turn the Hangzhou-based firm into a financial holding company, making it subject to capital requirements similar to those for banks. This change would also subject it to ownership scrutiny and the need to apply for fresh licenses.
Regulatory officers have further stated that With so much work needed and some rules not yet spelled out, Ant’s initial public offering may not get done before 2022.