How the tight bond between Alibaba and Ant has weakened under regulatory pressure from Beijing

The bond between Alibaba Group Holding and Ant Group, which share a common founder in Jack Ma and once even seemed to operate as one company, is unravelling at an accelerated pace as the fintech giant seeks a greenlight from regulators to go public.

Last week, Alibaba revealed in its latest annual report that the top executives of Ant Group, including chairman and chief executive Eric Jing Xiandong, chief technology officer Ni Xingjun and president of its international business group Angel Zhao Ying, had resigned from its partnership structure.

The Hangzhou-based Alibaba, which owns the South China Morning Post, also said in its annual report that the two companies agreed to terminate their data sharing agreement on July 25 and would instead “negotiate the terms of data sharing arrangements on a case-by-case basis and as permitted by applicable laws and regulations”.

The latest moves are signs of a further partitioning between the e-commerce giant and the operator of popular payment app Alipay, as the latter awaits Beijing’s nod to transform into a financial holding group. Ant, whose initial public offering was called off at the last minute in late 2020 under pressure from Beijing, has been restructuring itself as it seeks a green light from regulators.

“Ant senior staff will have substantially less influence on Alibaba. It’s another step in weakening the relationship between Alibaba and Ant,” said Chelsey Tam, a senior equity analyst at Morningstar. “The good thing is that Alibaba is more likely to make decisions based on what is good for Alibaba and not necessarily good for Ant.”

However, Tam said the flip side for Ant was that it could no longer rely on Alibaba to help boost its valuation.