|From: Sr K||10/26/2020 11:29:29 AM|
|From the WSJ story on Ant.|
Ant has already finished selling shares in Shanghai, with 80% of the offering going to so-called strategic investors, who will commit to hold the shares for at least 12 or 24 months. That proportion is a record for the STAR Market. Investors seeking to buy the remaining 20% of shares in Shanghai placed orders exceeding the stock on offer by more than 284 times, according to its filing.
On Monday, shares were already oversubscribed less than an hour after the order book was open for institutional investors in the Hong Kong leg of the IPO, according to a person familiar with the matter.
Strategic investors in the Shanghai shares include China’s national pension fund, and a slew of investment funds affiliated with China’s state-owned firms, insurance companies and banks, as well as mutual funds.
Foreign buyers include Singaporean state investors GIC Private Ltd. and Temasek Fullerton Alpha Pte. Ltd., the Canada Pension Plan Investment Board, and the Abu Dhabi Investment Authority.
Alibaba will also buy 51.1 billion yuan worth of shares, equivalent to $7.6 billion, to maintain its stake at around one-third of Ant. Mr. Ma and members of Ant’s top management will collectively own 39.5% of Ant after the IPO, before the exercise of any greenshoe.
The record-breaking deal will bring in hefty fees for a number of investment banks. Citigroup Inc., JPMorgan Chase & Co., Morgan Stanley and China International Capital Corp. have top billing as joint sponsors of Ant’s Hong Kong IPO, while CICC and China Securities Co. are joint sponsors of the Shanghai share sale. In total 25 institutions are working on the Hong Kong share sale, and six on the Shanghai tranche.
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|From: Sr K||10/31/2020 6:49:45 AM|
|Updated Oct. 30, 2020 12:48 pm ET|
To Ant Group Co. ’s set of staggering statistics— a billion users, more than $17 trillion in yearly payment volumes—add one more: trillions of dollars in stock orders from small investors.
Late Thursday, the Chinese financial-technology giant said individual investors in mainland China had placed the equivalent of more than $2.8 trillion of orders for their slice of Ant’s record-breaking initial public offering, in which it is listing simultaneously in Shanghai and Hong Kong.
That sum exceeds the value of all the stocks listed on the exchanges of Germany or Canada. Mom-and-pop investors in Hong Kong have also clamored to buy into this IPO, betting that Ant will soar in value after it goes public next Thursday.
More than 5 million individuals placed orders for shares in Shanghai, a record for IPO subscriptions on the STAR Market, a Nasdaq-style technology-focused board that launched last year. Orders exceeded the shares reserved for small investors more than 870 times.
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|From: Glenn Petersen||11/3/2020 8:57:15 AM|
|Ant Group’s record $34.5 billion IPO in Shanghai and Hong Kong suspended|
PUBLISHED TUE, NOV 3 20208:41 AM EST
UPDATED 4 MIN AGO
-- Ant Group’s world record-setting initial public offering (IPO) in Shanghai and Hong Kong has been suspended.
-- The Shanghai and Hong Kong stock exchanges made the announcement on Tuesday.Ant Group’s controller Jack Ma, the executive chairman Eric Jing and CEO Simon Hu were summoned and interviewed by regulators in China.
-- The Shanghai Stock Exchange said Ant Group reported “significant issues,” which means it may not meet the conditions for listing or “information disclosure requirements.”
SHANGHAI, China — Ant Group’s world record-setting initial public offering (IPO) in Shanghai and Hong Kong has been suspended.
The Shanghai and Hong Kong stock exchanges made the announcement on Tuesday. Alibaba, which owns a roughly 33% stake in Ant Group, saw its shares fall over 8% in pre-market trading.
Ant Group’s controller Jack Ma, the executive chairman Eric Jing and CEO Simon Hu were summoned and interviewed by regulators in China, according to a statement from the China Securities Regulatory Commission on Monday.
In a statement on Tuesday, the Shanghai Stock Exchange referenced this meeting in explaining why it has suspended the IPO.
“Recently, your company’s actual controller, chairman and general manager have been jointly summoned and interviewed by the relevant regulatory authorities,” the stock exchange said, according to a CNBC translation of its Mandarin comments.
“Your company has also reported significant issues such as the changes in financial technology regulatory environment. These issues may result in your company not meeting the conditions for listing or meeting the information disclosure requirements.”
As a result, the Shanghai Stock Exchange decided to suspend the company’s listing on the Science and Technology Innovation Board, also known as the STAR Market. That is China’s Nasdaq-style, tech-heavy market.
Shortly after, Ant Group put out a statement saying the listing of the Hong Kong shares will also be suspended.
Ant Group was gearing up to raise just under $34.5 billion in what would have been the world’s biggest public listing. It was planning on a dual listing in Shanghai and Hong Kong on November 5. It’s unclear at this stage if the Hong Kong leg will go ahead as planned.
A spokesperson for Ant Group was not immediately available for comment. An official filing with the Shanghai Stock Exchange is expected soon.
On Monday, the Chinese central bank and regulators issued new draft rules for online micro-lending, which could affect Ant Group.
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|From: Julius Wong||11/4/2020 7:35:20 AM|
|The Ant Got Crushed, Buying Opportunity For Alibaba|
Nov. 4, 2020 6:30 AM ET
Long/Short Equity, Growth At Reasonable Price, Contrarian, Deep Value
* Ant Group announced the suspension of its blockbuster IPO in both Shanghai and Hong Kong, resulting in an 8.1 percent plunge on Tuesday.
* The suspension of the IPO was not due to some shenanigans discovered but the release of draft rules stipulating tightened online microlending standards.
* The new rules impact the entire industry, not just Ant Group. As an sector leader, Ant has an advantage to emerge from this debacle stronger than peers.
* Readers familiar with my coverage on Tencent would know it similarly suffered from regulatory tightening but has thrived in spite of the scrutiny.
* I argue that Alibaba's Tuesday plunge is a buying opportunity.
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|From: Glenn Petersen||11/5/2020 8:44:27 AM|
|How billionaire Jack Ma fell to earth and took Ant's mega IPO with him|
By Keith Zhai, Julie Zhu, Cheng Leng
November 5, 2020
9 MIN READ
SINGAPORE/HONG KONG/BEIJING (Reuters) - They say talk is cheap. Tell that to Jack Ma.
Corporate China’s shiniest star was just days away from seeing his Ant Group list on the stock market in a record $37 billion deal, when he chose to launch a blistering public attack on the country’s financial watchdogs and banks.
The regulatory system was stifling innovation and must be reformed to fuel growth, billionaire Ma told a summit in Shanghai on Oct. 24 attended by the great and the good of China’s financial, regulatory and political establishment.
Chinese banks, he said, operated with a “pawnshop” mentality.
It was this speech that set off a chain of events that ultimately torpedoed the listing of Ant, the fintech titan Ma founded, according to interviews with government officials, company executives and investors. They all requested anonymity to disclose confidential details.
Stung by the attack, Chinese regulators and Communist Party officials set about reining in Ma’s sprawling financial empire, culminating in the suspension of the IPO on Tuesday, two days before the eagerly awaited market debut in Shanghai and Hong Kong, the sources said.
While Ma might not have realised the impact his words would have, people close to him had been baffled to learn in advance about the tone of the speech he planned to deliver, according to two sources close to Ma.
They suggested the 56-year-old soften his remarks as some of China’s most senior financial regulators were due to attend, but he refused to budge, believing he should be able to say what he wanted, the sources said.
“Jack is Jack. He just wanted to speak his mind,” said one of the people.
It was a costly miscalculation.
Several senior financial regulatory officials were furious at Ma’s criticism, two sources told Reuters, with one source characterising the speech as a “punch in their faces”.
State regulators started compiling reports including one on how Ant had used digital financial products like Huabei, a virtual credit card service, to encourage poor and young people to build up debt, according to the two people.
The general office of the State Council compiled a report on public sentiment about Ma’s speech and submitted it to senior leaders including President Xi Jinping, the sources said.
Some of the reports indicated public sentiment was negative on Ma and his remarks, the people said.
Top Chinese leaders then became more involved and asked for a thorough investigation of the company’s business activities, which eventually led to the halting of the world’s biggest IPO, three of the sources said.
The People’s Bank of China (PBOC), the China Banking and Insurance Regulatory Commission, China Securities Regulatory Commission, the State Administration of Foreign Exchange,and the State Council Information Office did not immediately reply to Reuters requests for comment.
Ma could not immediately be reached by Reuters for comment and e-commerce group Alibaba, which handles media inquiries for Ma, did not respond to a request for comment on this story from its lead founder.
The chance of the flotation getting back on track in the near-term is slim, according to six of the people, as regulators look to tighten scrutiny of the company. No listing is expected for at least the next few months, two said.
It was a stunning reversal for Ma, who would have added at least $27 billion to his net worth from the IPO.
In years gone by, most regulators had left the billionaire to his own devices, partly because of his close ties to some senior government officials, according to five of the sources, but also because of national pride in his success.
Ma, a former English teacher, is one of China’s internet pioneers, building an e-commerce empire with Alibaba and a fintech giant with Ant.
When the PBOC tried to regulate Ant’s payment and wealth management business about five years ago, Ma bypassed the central bank after failing to reach a consensus with regulatory officials and lobbied the central government. The PBOC later dropped those regulation plans.
“Jack Ma did not bypass the customary process of communicating with relevant regulators regarding Ant’s payment and wealth management business,” Ant’s spokeswoman said in an emailed response to Reuters.
But with his Oct. 24 speech, Ma misjudged the shifting priorities of Beijing, according to one senior regulatory source, believing he could challenge the financial establishment yet retain the support of the central leadership.
The bigger picture was that one of the government’s main aims this year is to shore up the country’s financial sector and tighten regulatory oversight to prevent systemic risks in a pandemic-hit economy, the person said.
Even before Ma’s speech, Chinese regulators were gradually increasing their oversight of Ant, which has largely thrived as a technology platform free from costly banking regulations despite its bouquet of financial offerings.
The scrutiny has particularly intensified for the company’s rapidly growing online consumer-lending business, a cash cow, which sources demand from retail consumers and small businesses and passes that on to about 100 banks for underwriting.
REGULATORS MAKE MOVE
The Shanghai speech was the trigger for a major escalation, according to half of the dozen people interviewed, prompting senior political officials to ask regulators, including the central bank and China’s top banking regulator, for the thorough review of Ant’s businesses.
The watchdogs, who had for years wanted to rein in Ma’s fintech empire, moved fast after receiving written instructions from officials including Vice Premier Liu He, a trusted economic adviser to President Xi, said two of the people.
The State Council Information Office did not immediately respond to a Reuters request for comment from Liu.
As part of this drive, regulatory officials rushed to publish a consultation paper this Monday to tighten rules for the country’s micro-lending business, which directly impacts Ant, said one person with direct knowledge.
The draft requires micro-lenders to fund at least 30% of any loan they fund jointly with banks. Only 2% of the loans Ant had facilitated as of end-June were on its balance sheet, its IPO prospectus showed.
Top Chinese industry players including Ant and Lufax Holding Ltd, an online wealth management platform, were aware of the draft details weeks before its public release, said two of the people.
Lufax, which raised $2.4 billion in a New York IPO last month, had informed investors that regulators had required leading online micro-lenders to provide about 20%-30% of any loan they fund jointly with banks, according to two investors who joined its roadshow.
Lufax declined to comment due to quiet period restrictions following its IPO.
By contrast, Ant’s executives did not mention the possible regulatory changes during its two main calls with global investors during its roadshow last week, two other investors said.
Ant’s spokeswoman said the company was not aware of the details of the draft online micro-lending rules until they were published on Monday.
HUBRIS AND HUMILITY
After the publication of the micro-lending consultation paper, Ma and the two top Ant executives were summoned to a rare joint meeting with four regulatory bodies.
They were told that the company, notably its consumer-lending business, would face tougher scrutiny over matters including capital adequacy and leverage ratios.
Regulators had been surprised by the scale and risk model of Ant’s lending division, details of which were disclosed in the IPO-related filings since late August. The unit, which includes Huabei and short-term consumer loan provider Jiebei, contributed close to 40% of the group’s revenue in the first half of the year.
A day later, the Shanghai stock exchange said it had suspended Ant’s IPO, citing a “significant change” in the regulatory environment, prompting the company to also freeze the Hong Kong leg of its dual listing.
China’s securities industry watchdog said subsequently that recent regulatory changes could have a “major impact” on Ant’s business structure and profit model. It said suspending the IPO was a responsible move both for investors and markets.
The suspension marked the nadir of what has been a gradually souring relationship over recent years between Ma’s corporate empire and Chinese regulators, from the central bank to the internet and markets watchdogs.
After the announcement, however, Ant released a statement in which it pledged to “embrace” regulation.
“It has no alternative but to do so,” Gavekal Research analyst Andrew Batson wrote in a report this week. “Ma’s hubris has now morphed into humility.”
Reporting by Keith Zhai in Singapore, Julie Zhu in Hong Kong and Leng Cheng in Beijing; Editing by Sumeet Chatterjee, Pravin Char and Carmel Crimmins
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|To: Glenn Petersen who wrote (734)||11/6/2020 1:08:30 PM|
|From: Glenn Petersen|
|An alternative, very plausible, take on Ant:|
Pulling Ant's IPO might have been the right move
November 6, 2020
When Ant Group's IPO was pulled by the Chinese government on Tuesday, all eyes — including mine — immediately went to Jack Ma's speech from a week earlier, in which he publicly criticized China's financial regulation. The suspension looked like a clear act of retaliation: China was showing Ma who's really boss. And that explanation certainly holds some truth.
But the reality is likely much more complicated. "I can't quite believe that [regulators are] so petty that they suspended the IPO simply because of Jack Ma's angry speech," Fraser Howie, co-author of "Red Capitalism," told me this morning.
Tanking a listing that was set to bring a lot of positive attention to China can't have been an easy decision to make and it's hard to believe that it's a decision made solely out of spite.In fact, Howie suggested, Chinese authorities may have decided it was in fact necessary to step in to save investors' skin.
To understand what's really going on, it's important to look at draft regulations that China had been planning for weeks and finally published on Monday. Under the proposed rules, online lenders like Ant would have to make at least 30% of their loans themselves, rather than outsourcing them to other companies. That compares to a roughly 2% requirement today.
The change could have a huge impact on Ant's balance sheet: The Financial Times cites one anonymous expert who thinks Ant would need "an extra $20 billion or so in capital reserves" — more than half the amount Ant was set to raise. Another said the impact could be so big that Ant's valuation halves.
Ma apparently knew all about these new rules, even though they were only made public Monday. The FT reports that at the time of his speech, Ma was privately discussing the rules with regulators. And people across the fintech industry knew regulation like this was inevitable. "They did not write these regulations … [in] three days," Howie said.
So Ant appeared to know that huge rule changes were coming that would totally change its business, and it said … almost nothing. Its IPO filing does not describe the proposed changes in much detail, while Reuters reports that the company did not tell investors about the changes during its roadshow.Ant executives "were presenting a picture of themselves which was not going to be a good representation of their business going forward," Howie said.
All that raises a big question: Was Ant trying to list before these new rules came into effect in an effort to achieve a higher valuation?
If that was the case — a big if! — then it suddenly becomes much clearer why regulators intervened to stop the listing. "If the company had listed, and then they changed the rules and you had this dramatic collapse in Ant's share price," Howie said, "the question that would have been asked is 'Why didn't the regulators do something earlier?'"Pulling the listing may have been embarrassing, but maybe not pulling the listing might have been even more embarrassing.
The upshot? While some think the pulled listing might hurt investor demand for Chinese shares, the opposite could be true. "I don't want to give Chinese regulators too much credit," Howie said, "but I also don't want to just dismiss out of hand the fact that they've probably done a lot of investors a service."
We'll know for sure if they have been helped when Ant eventually returns for round two. If it ends up going public at a much lower valuation, investors might find themselves grateful — albeit at Jack Ma's expense.
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|From: Glenn Petersen||11/10/2020 8:14:09 AM|
|Ant Group’s valuation could be slashed by over $150 billion after suspended IPO, experts say|
PUBLISHED TUE, NOV 10 20203:51 AM EST
-- Chinese financial technology giant Ant Group, which was gearing up for the world’s biggest initial public offering (IPO), could see its valuation come crashing down, experts said.
-- China has proposed new regulation on micro-lending which could lead Ant Group to require hold more capital and alter its business model.
-- The result could be making Ant Group look more like a bank than a fintech company, experts said. That could lower its valuation.
Guangzhou, CHINA — Chinese financial technology giant Ant Group, which was gearing up for the world’s biggest IPO, could see its valuation come crashing down after its public listing was suspended, experts said.
It comes as Beijing announced there will be proposed regulations on micro-lending — a move that could force Ant Group to hold more capital, and make the company look a bit more like a bank rather than a technology company, the experts told CNBC.
“The biggest risk for Ant will be shifting from a fintech to a capital intensive regulated bank and not losing its competitive connection with consumers,” Eric Schiffer, CEO of private equity firm The Patriarch Organization, told CNBC by email.
“The proposed regulation decimates Ant’s valuation to more than 1/2 taking it under $150 billion.”
Ant Group, which is a third owned by e-commerce giant Alibaba and controlled by founder Jack Ma, was set to start trading on Nov. 5 in Shanghai and Hong Kong. The initial public listing would have raised just under $34.5 billion — setting a new world record, and valued it at $313 billion.
But two days before that listing, the Shanghai Stock Exchange said it was suspending the IPO and that Ant Group reported “significant issues such as the changes in financial technology regulatory environment.”
The shock move came after Ma appeared to criticize Chinese regulators and after he and two other other top Ant Group executives were called into a meeting with regulators three days before the listing.
Regulations in focus
Chinese regulators also released draft rules for the micro-lending sector in China last week, which could directly impact Ant Group’s business. The company’s biggest revenue driver is what it calls “CreditTech.”
Ant Group offers loans which are independently underwritten by the company’s partner financial institutions, which includes around 100 banks.
The Chinese giant says that around 98% of credit balance originated through its platform as of June 30 2020, were by its partner financial institutions or securitized.
That allows Ant Group to tout itself as a capital-light business.
But Beijing has proposed a joint lending model where internet platforms should fund no less than 30% of total loans. That appears to be the most significant point of the regulator’s draft proposals.
“This may be perceived by the regulators as constructing an unfair playing field – collecting the fees without taking the risks of a traditional lending institution – thus explaining the new reserve requirements,” David Hsu, a professor of management at the University of Pennsylvania’s Wharton School, told CNBC.
The result would effectively mean Ant Group needs to hold more capital.
“This would mean a shift away from the ‘asset light’ model which makes it more like a tech company selling tech services, (to) more like a bank backing up loans with its balance sheet,” Kevin Kwek, managing director and senior analyst at Bernstein, told CNBC by email.
“Views on valuation will also be affected as a result since tech multiples are much higher.”
Iris Tan, Morningstar’s senior equity analyst, estimated that Ant Group could be required to hold an additional 50 billion yuan ($7.56 billion) to 90 billion yuan under the joint funding proposal.
“Profit & loss impact should be insignificant, as the additional revenue as interests generated from self-funded loans should be able to cover expected credit losses in our view,” Tan said in an note published last week. “But the impact on valuation could be significant.”
Tan said Ant could top up its registered capital, shift the operating entity to a newly established consumer finance company and scale back their total consumer credit size.
“Ant isn’t short of the required capital today,” Bernstein’s Kwek noted. “The issue is more around the perceptions on operating model and potential constraints on growth in the future should capital not be sufficient.”
What does this mean for valuation?
Most experts agree that Ant Group’s valuation could take a beating, but some are unclear on what the final
number might be. The dual IPO would have valued Ant Group at around $313 billion.
Tan said there are two potential negative impacts to valuation. Firstly, the need to ensure adequate capital or the equity portion of the business which could limit growth. Secondly, Ant’s lending business could be valued more like a bank rather than a technology company.
Banks tend to have lower so-called price-to-earnings (P/E) ratios than technology firms, one of the valuation metrics used by investors.
Bernstein’s Kwek said the market had priced in Ant Group’s price-to-earnings at the “higher end” of the Alibaba and Tencent range. Alibaba’s trades at just over 31 times earnings in the last 12 months. Tencent trades at nearly 50 times earnings in the last 12 months.
But instead of being valued in this range, Kwek said Ant Group was likely to be lower.
“The opposite might happen now, even lower for investors that are taking growth down significantly. Also, demand was a big factor driving up the P/E before and that’s obviously going to be softer next time around,” Kwek told CNBC.
“Our view is that it shouldn’t be on bank multiples — Ant is still a very unique model on a very strong payments base, off the (Alibaba) e-commerce platforms. A huge challenge has been put in front of it but it is too early to say they can’t come through,” Kwek added.
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|To: Glenn Petersen who wrote (736)||11/10/2020 3:00:45 PM|
|From: Glenn Petersen|
|China drafts new antitrust guideline to rein in tech giants, wiping US$102 billion from Alibaba, Tencent and Meituan stocks|
-- Draft guideline ‘targeting tech giants’ in e-commerce, online food delivery and ride hailing, Atta Capital’s Alan Li says
-- Tech giants plunge broadly in Hong Kong trading on Tuesday, with Meituan and JD.com both down by more than 8 per cent
Yujing Liu and Daniel Ren in Shanghai
South China Morning Post
Published: 1:45pm, 10 Nov, 2020
China has released a draft antitrust guideline to rein in internet-based monopolies, signalling policymakers’ heightened concerns over the growing power, influence and risks of digital platforms and their market practices in the economy. The move immediately erased about US$102 billion of market value from Alibaba Group Holding, Tencent Holdings and Meituan.
Monopolistic practices by internet platforms, such as demanding vendors to transact only on one platform
exclusively, or providing differentiated prices to customers based on their shopping history and profiles, could potentially be outlawed, according to the guideline released by the State Administration for Market Regulation on Tuesday.
This is the first time the market regulator has attempted to define what constitutes anti-competition practices among internet companies under the law. An overhaul to the Anti-Monopoly Law in January went only as far as tweaking the language to encompass internet companies. It will seek public opinion on the draft until the end of November.
“The policy is clearly targeting the tech giants, with e-commerce, online food delivery and ride hailing platforms likely to receive the biggest blow because of how concentrated these sectors are,” said Alan Li, portfolio manager at Atta Capital in Hong Kong. “This is probably just the first warning shot.”
The guideline also deems activities like platforms offering steep discounts to eliminate rivalry, colluding on sharing sensitive consumer data, and forming alliances to force out competitors, as potentially monopolistic.
The latest move has put China watchers on alert as Beijing appears to start clipping the wings of some of the biggest companies that helped revolutionise consumer spending behaviour in the world’s second-largest economy. Just last week, it surprisingly halted Ant Group’s record-breaking stock offering
by throwing new microlending rules at the Jack Ma-controlled fintech company.
Chinese internet giants widened their losses through Tuesday trading in Hong Kong, after their American depositary shares tumbled in New York. Alibaba, operator of China’s largest e-commerce platform and owner of this newspaper, fell 5.1 per cent to HK$275.40, after sliding 3.1 per cent overnight. Tencent, which runs the country’s most popular messaging app, retreated 4.4 per cent to HK$595. Online food delivery giant Meituan dived 10.5 per cent to HK$300.
The slump erased HK$790 billion (US$101.9 billion) of market capitalisation from the trio popularly known as the ATM stocks, according to Bloomberg data. JD.com lost 8.8 per cent to HK$330.40, wiping HK$100 billion from its market value.
A representative of Alibaba declined to comment on this topic. JD.com, Tencent and Meituan did not immediately reply to requests for comment.
A clampdown on Chinese internet and technology giants would not be surprising in the global context. The US Justice Department and 11 states filed an antitrust lawsuit against Alphabet Inc’s Google last month for allegedly breaking the law in using its market power to fend off rivals, according to a Reuters report. It marks the biggest antitrust case in a generation, comparable to the lawsuit against Microsoft filed in 1998 and the 1974 case against AT&T.
The new draft guideline is the first clear sign that Beijing is seeking to curtail the expanding prowess of its home-grown tech champions, analysts said, as they provoked increasing controversies in recent years regarding their labour and market practices.
How big are China's tech giants?
Alibaba and Meituan have significantly shaped people’s daily lives in China over the past decade – an estimated 400 million people in the nation now order food delivery from their smartphones and 855 million shop online, according to Daxue Consulting and McKinsey & Co.
“The draft rules appear to be harsh since a big number of practices are defined as monopolistic, such as exclusivity agreements that prevent vendors from selling goods on rival platforms,” said Gong Zhenhua, a partner with Shanghai Ronghe Law Firm. “Though the regulator did not release details of punishments on the wrongdoings, it can be expected that those players that fail to comply with the rules under tight regulatory oversight will pay a high price for the practices.”
Wang Xuliang, owner of a restaurant in Shanghai which uses several food delivery service platforms to cater to customers who opt not to dine out, said the new rules could benefit small shops like his because they have no bargaining power on fees charged by the internet giants now.
“Profit margin of our businesses is thin, and we want the platforms to lower the fees to help us shore up profitability a little bit,” he said. “But the platforms are essentially needed by us to promote business. We just hope that they can sacrifice some profits to support us.”
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