Jack Ma is getting a lesson about who is in charge.
Chinese regulators on Tuesday suspended the $34 billion initial public offering of Ant Group, the online-finance operation carved out of e-commerce giant Alibaba Group , just two days ahead of what was planned to be the world’s largest-ever initial public offering.
The extraordinary regulatory action, according to Chinese officials and others with knowledge of the process, caps a monthslong tug of war between Mr. Ma, the billionaire co-founder of both Alibaba and Ant, and top regulators led by Vice Premier Liu He, President Xi Jinping’s point man on economic and financial policies.
It is hard to overstate the importance in China of Mr. Ma and his two companies. They have become synonymous to innovation. The media in China, using Mr. Ma’s Chinese name, calls the country’s rising tech sector, “The era of Ma Yun.” Mr. Ma’s criticism of regulators last week for stifling innovation appears to have brought his feud with the government to a head at a risky time for Ant.
For Mr. Liu and his financial regulators, Ant’s business model represents big risks that must be reined in. When it halted Ant’s IPO on Tuesday, the Shanghai Stock Exchange said it was because of a “significant change” in the regulatory environment, without elaborating.
