Image Source : China Visual

BEIJING, November 15 (TMTPOST) — The consumer finance unit of China's Ant Group will increase its registered capital to 18.5 billion yuan ($2.62 billion) from 8 billion yuan ($1.13 billion), according to the announcement of three listed companies, namely Yuyue Medical Equipment & Supply Co., Ltd., Zhejiang Transfar Co.,Ltd. and Sunny Optical Technology, on Monday evening.

After the capital increase was announced and suspended afterwards at the end of 2021, the capital increase program of Chongqing Ant Consumer Finance Co Ltd. has finally seen progress after a year of adjustment.

An exchange filing on Monday showed that a subsidiary of Sunny Optical Technology Group Co. is going to take 1.1 billion yuan ($156.13 million) of Chongqing Ant Consumer Finance Co.’s capital, taking a 6% stake. Jiangsu Yuyue Medical Equipment & Supply Co. plans to add 524 million yuan ($74.35 million), for a 4.99% stake. Ant Group will contribute 5.25 billion yuan ($745.07 million) to retain its 50% holding as the largest shareholder, while other backers are also investing, statements show.

The size of this capital increase has shrunk significantly from the capital increase proposal at the end of last year, from 22 billion yuan ($3.12 billion) in the original capital increase proposal to 10.5 billion yuan ($1.49 billion) . The registered capital after the capital increase has shrunk from 30 billion yuan ($4.25 billion) in the original capital increase proposal to 18.5 billion yuan ($2.62 billion). Although Ant has made a clear distinction between Ant Credit Pay and Ant Cash Now, whether the $18.5 billion ($2.62 billion) is enough to support the scale of Ant Group's self-sustaining business remains to be seen.

After this capital increase, the shareholding ratio of state-owned shareholders will drop to about 20% from 28% in the original capital increase plan, which is roughly the same as the shareholding ratio of state-owned shareholders at the time of the establishment of Ant Financial.