BEIJING: Chinese authorities have given approval to Jack Ma’s Ant Group to raise 10.5 billion yuan ($1.5 billion) for its consumer finance arm, in a sign that Beijing may be loosening its grip on the fintech giant.

An office of the China Banking and Insurance Regulatory Commission in the southwestern city of Chongqing will let the firm raise its registered capital from eight billion yuan to 18.5 billion yuan, according to a notice issued on December 30.

After the deal goes through, Ant – in which ecommerce titan Alibaba has a stake – will have contributed a total of 9.25 billion yuan and control half of its shares.

A unit owned by the eastern city of Hangzhou will become the second-largest shareholder with a 10 percent stake, the notice said.

It added that Ant is required to “complete the relevant statutory proceedings” within six months of receiving the authorisation.

Chinese authorities have cracked down on major technology firms in recent years, and in 2020 pulled Ant’s planned initial public offering in Hong Kong at the last minute. The listing would have been a world record at the time.

Beijing also hit Alibaba, which Ma co-founded and formerly headed, with a record $2.75 billion fine for alleged unfair practices.

Jack Ma living in Japan after China tech crackdown: FT

News of China’s agreement to the fundraising sent shares in Alibaba soaring almost nine percent in Hong Kong trading, while other tech firms were also boosted on hopes the sector crackdown could be winding down. JD.com jumped more than six percent and XD was up almost eight percent.

Alibaba did not release full sales figures for China’s Singles Day shopping bonanza in November, a period when consumers typically flock to snap up bargains on its Taobao and Tmall e-commerce platforms.

The company said instead that sales were flat from 2021.