China halts Jack Ma's Ant IPO debut, says ''necessary, reasonable'' to curb risks

China’s move to suspend Ant Group’s $37 billion (£28 billion) listing is "necessary, reasonable and legal," given rising concerns over risks to financial stability, a top Chinese state-backed newspaper cited an expert as saying on Wednesday.

Beijing’s surprise actions on Tuesday thwarted the world’s largest stock market debut with just days to go, in a dramatic blow to the financial technology firm founded by billionaire Jack Ma.

There have been more public discussions in China recently over issues caused by large tech firms moving into the financial space, especially over fair competition and data privacy, the Chinese Securities Journal quoted Zhang Zixue, a professor at the China University of Political Science and Law.

Ant and its intermediaries should "fully evaluate the problems and risks reflected in public opinion, and take effective preventive measures," he told the newspaper.

The Shanghai stock exchange said it had suspended the company’s initial public offering (IPO) on its tech-focused STAR Market, prompting Ant to also freeze the Hong Kong leg of its dual listing scheduled for Thursday.

The decisions followed a meeting with China’s financial regulators on Monday during which Ma and his top executives were told Ant’s lucrative online lending business would face tighter scrutiny, sources told Reuters.

The topic "Ant Group’s IPO suspended" was the top trending topic on China’s Twitter-like Weibo on Wednesday morning, garnering about 640,000 discussions.

Some said that while regulators had "closed one eye" to Ant’s rapid growth in the past, its IPO meant they could no longer do so, since risks would now shift towards its shareholders and the public.

Many took aim at Ma, who had made a speech at an event last month attended by Chinese regulators that criticised the financial and regulatory system as stifling innovation and needed to be reformed to fuel growth.

Commentators said Ma, who also founded Ant’s affiliate Alibaba Group , had forgotten his place.

"How dare he tell others how to regulate!" said one user called “Pangtianshi”, who has 1.1 million followers.